Home price gains slowed
In comparison to August 2013 where 36,614 homes were sold in California, in contrast to 34,269 sold in August 2014. On a regional basis, over the past 12 months sales are down 15.7 percent in the Bay Area, 16.7 percent in Southern California, and 18.8 percent in the Central Valley.
One explanation for the decline could be the disappearance of distressed properties available for sale. In August 2013 24.0 percent of sales were distressed properties compared to 16.7 perecent of total in August 2014.
The August 2014 median price of a California home was $390,000 unchanged from July. This was the clear sign of the median home price gains have indeed stopped for the time being.
In fact, in Los Gatos we are seeing some homes pulled off the market after being over-priced and staying on the market for at least 90 days. The implications are that the market is no longer hyper active where you can anticipate 10-15 offers. So, it’s extremely critical to price you home right in this market or you will be chasing it.
Another elephant in the room is the climate of rising interest rates where some home buyers will not qualify for a mortgage. And the rates will continue to rise in 2015 with the FED’s announcement that they will stop buying mortgages.
So, if you are selling your home, you will need a more calculated plan to get the highest price possible. Contact Us if you have any questions about the current market.