California Housing Market Trends | Real Estate Inventory is SPIRALING across the US

February 10, 2023

California Housing Market Trends | Real Estate Inventory is SPIRALING across the US

Get out and buy now. If you think the market will fail, then don't. If you wait, and rates go lower, you will see 2021 all over again.

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If you haven't watched Wednesday's Video, you can right here!

TRANSCRIPT

Hey, good morning. Good morning. It's February 9th, Thursday. It's garbage day here, so you might hear the garbage guys coming around. Today, we're talking about what's going on with the inventory all across the US mentioned yesterday, I mentioned on Tuesday, that our inventory is remaining low and in a common market.

If economics 1 0 1, you know you have supply and demand. and supply is staying low, and demand is staying pretty consistent. We have houses that are being sold not at the same rate. I wanna show you a chart that I saw just recently, but not at the same rate. What we were seeing.

Two years ago. Two years ago, was an anomaly because we had free money. And free money is a natural part of a system where you have supply and demand. When you have free money, prices go up because demand increases and supply remains relatively stable. When you have stable supply and demand goes. Prices are forced to go higher.

That's why we saw record crazy prices on homes and cars and eggs, right? So the whole idea here is how do we get you into a house understanding what the market is and understanding, Hey, look, Mr. Seller, the market isn't what it was. I know you thought the house was worth 2 million, but. Today we're seeing houses sell for 1.6.

Okay? It's not my fault, it's not your fault. It's just timing. That's just what it is. It's because rates went up, and affordability went down when you had something at two, and a quarter when you have a house. Or you could buy it with two and a quarter 2.25, 2.5% interest rate. It's a lot more affordable than it is at 6%, almost three times.

So let's go into this really quick inventory watch. This is all talking about supply, the supply part. A couple of days ago we were talking about. Interest rates and all that other stuff. We talked about the highs and lows. We talked about inventory and price rates. Yesterday Wednesday, I think we had, yeah, I think it was Wednesday we had Hector on, no, it was Tuesday.

We had Hector on talking about rates and. Six and a six and a half, right? That's not good. I know we can go under five, under 6% right now. I know we're talking 5% for the most part, but that's the quoted rate, right? So when it's less affordable to buy the same million dollars or a thousand dollars your home becomes less affordable.

Less people are going to try to buy it. , and quite frankly what's happened over the market, over the timeframe is that the buyers have realized this, and the market slowed down considerably. We're not in a panic mode, but when we're used to seeing a hundred, 150 contracts being signed every week in a county and now we're down to 40, it's a lot less volume just talking Sure.

Numbers. Saving graces. You look at San Jose alone 252 homes available for some. That number is not exact. It's just the number I pulled from this, and it's on realtor.com. Nothing on the ancillary sites is ever going to be a hundred percent accurate, right? But I use it for baseline just so you can see what's going on.

Yesterday I was looking at it, it was 324 for that. , so it's a little bit different. Again this isn't the exact number it's going to come down. These aren't the exact numbers. I heard in Phoenix, Arizona. It was something like 20,000 homes for sale that included mobile homes, condos, townhouses, and everything available for sale in the Phoenix region, right?

It's a whole lot more than that. Tampa and again, the red means the inventory went down from last week. We've only had 2, 3, 3 of the cities that I'm tracking go up just a tad bit 12 there. Eight there. I don't even, I can't even count right now. For the rest of them, the inventory is staying fairly stable.

It's not like we're seeing many houses hit the market. Again, this isn't the selling season. March, April, and may, we're going to see a glut of inventory hit the market, but we're also going to see buyers hit the market. We're probably going to see their rates go down a little bit. Is that going to be a great time too?

No, because when you're competing against the same house with 10 other houses or other buyers, it's not going to work for you. You're going to be frustrated. You're going to be, you're going to be writing 20 offers. You're going to be, you're going to have to write over the list price, right? And here's the thing, right? I said it in my comments down below.

get out and buy. Now. If you think the market will fail, then don't even bother If you're going to be the chicken little, I'm not making fun of you. D I understand. I have my qual qualms too. I don't know if the market's going to crash or not. I don't think it is cuz the economy's doing real re relatively well even though we're running out of eggs.

If you wait for rates to go lower and inventory to come up, and you wait for the buying season to happen, then you're going to wind up competing. , and that's what you don't want to do. I just got into a contract again with another set of buyers. Yesterday we were the only ones at the table, right? We came in $170,000 less, and then we went up 25.

We made the seller happy. I made my buyers happy. Everybody's happy. This is the time to get deals done, guys. I'm telling you. Will the market. It is possible. I don't know. But here, look, this is again, we do this thing with the median rate, the median prices across us. This is inventory active, everything that's available for sale right now in us, right PUDs, condos, townhouses, developments, new homes, used homes and reused homes.

Right now we're at $42,000 in homes for sale. It's not like it was in 2022 when we had a glut. Just a total bottoming out. February 2022, we had zero inventory. I remember you seeing this in the news, right? There's no inventory while the list's coming down. It's not the same place as it was in 2022.

But right. Then when this started happening, that's when rates went up. So right now we're seeing, hey, you know what, seller, why don't we wait until March? If, whatever, if you're in Idaho and the selling season is summer, talk to your agent there, right? I can tell you specifically for Silicon Valley, Santa Clara County, and most of the counties around the South Bay selling season is March and April.

Am I selling houses right now? Yes, we're selling houses right now. Not at the same glut, but this is the time when there are fewer buyers, and there's less competition to do it. Guys, I'm telling you, what happens if the market crashes? Oh no, the market crashes. Wait five years, 10 years, the market will come back, right?

It's, oh, but I want to wait for the perfect thing. Great. Guess what happens when the market crashes? Everybody else comes out. The investors come out. The foreign investors come out, that cash buyers come out, and then you're competing with three times more, three times as many buyers than you had before.

Everybody's waiting. If you're looking for a first-time home, right now is the time to buy. If you're looking to move up or down, now is the time to buy or sell. All right, so that's me. Weekend motivation. I do this four times a week. Share this out. The last thing I want to talk about is I'm introducing third Thursdays again.

We did this a couple of years ago and then Covid happened, but we're having a happy hour. I'll buy you a drink. Doesn't have to be alcoholic. I just went to the gym and invited a couple of guys that are like, I don't drink, I don't, I'm not drinking yet. I'm not like not drinking. I'm just not drinking, trying to lose weight, coming out for a nice tea or a club soda or something, and just enjoying being in the community again, being social.

Come on out if you're interested in it. Let me see if I can find out what to do. Yeah, blank. Text me down there, 4 0 8 7 0 5 6 8 1 7. Let me know who you are. Happy to invite you. I'm not going to release where it is until the day of, which is February 16th. Thursday, February 16th. All right. That's it for now.

Have a fantastic weekend. Enjoy the Super Bowl. We'll see you out.

Vito Scarnecchia

Realtor®, Broker, Veteran, Dad

DRE#: 01407676

Website: abitano.com

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