2013 Real Estate Trends & Dynamics for Alamo & Danville California
Forces driving the local real estate markets along the I-680 Corridor in the East Bay that you need to stay informed about.
- Multiple Offers – Houses are turning over very, very fast and getting multiple offers.”
- Tight Inventory – Homes for sale inventory has decreased significantly in every Bay Area county in 2012 as demand shoots past available supply.
- Record Low Interest Rates – are expected to continue through this years prime home selling season
- Fewer Foreclosures – foreclosures in many neighborhoods have dropped to zero
- Increasing Employment – New jobs at Bishop Ranch helping helping to drive home sales.
- Rising/Stabilizing Home Prices
New home construction is rebounding and will be contributing to local housing market dynamics in many areas, but not so much in Danville and Alamo CA as these Bay Area communities will not see new neighborhood developments.
Inventory, Inventory, Inventory
In the Bay Area, buyers can anticipate little new inventory on the market. A supply of only about 2 1/2 months’ worth of single-family homes for sale was available statewide at the end of December, the California Assn. of Realtors reported Tuesday. A supply of six or seven months is considered healthy by most economists. In Danville and Alamo housing inventories are in the 1 to 2 month range.
“For 2013, we largely expect more of the same,” Sean O’Toole, chief executive of ForeclosureRadar, wrote in a blog post this week. “Demand will remain strong thanks to Federal Reserve-manipulated low interest rates and affordability. Housing supply will remain constrained, largely due to government foreclosure intervention. As a result, prices will rise, though likely at a slower pace.”
Future Housing Prices
Housing prices are starting to see at least modest annual increases. According to University of California, Berkeley, economist Kenneth Rosen, housing prices may post modest increases of 1 to 2 percent annually through 2020.
Though average housing prices are expected to increase 1 to 2 percent annually, individual markets may experience steeper rises. In housing, location is everything, and prime real estate locations will no doubt see greater price increases. – SF Gate
How the Fed is Manipulating Housing Market Dynamics
The Fed is going to continue to buy mortgage backed securities through 2015. The people benefiting most from this are real estate investors and the face of the investor has changed dramatically in the last two years – it’s no longer a single or even a pool of investors, today it’s hedge funds.
Even economists within the Federal Reserve are noting that while the government’s mortgage securities purchases are lifting home prices, they are not necessarily helping the average American buy a house. Michael Bauer of the Federal Reserve Bank of San Francisco noted in a May 2012 report, “The link between rates on mortgage-backed securities and actual mortgage rates has weakened in the wake of the financial crisis.” In other words, the Fed’s ability to stimulate lending and get houses into the hands of individual home buyers isn’t working as planned, but still home prices are rising. – Truthout
Our FREE Alamo Real Estate Market Reports are the best source of data you can get for Alamo and Danville CA neighborhood real estate markets.
Email Craig if you would like to know more about buying or selling a home or condo in Alamo or Danville CA (925) 984-4910
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