Rates below 6%? Opportunity: rates drop to 2024 low point

 


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Introduction: The Magic Number 5

The magic number 5.5 percent is coming closer. Today's median price across the United States is in a doldrum and reasons to get your house ready to sell as well as what you get for 2 million in Santa Clara County and what you get for 1 million in Santa Clara County.

lastly, the inventory and supply charts of the Bay area. Let's get moving here.  

Current Market Trends and Inflation
The median price across the United States is lower.

Back in 2022, we had 442, 000. I remember when we were at 416, 000, which was then adjusted to 414, 413. Now we're back down to 412. What's going on with the market? The market's slowing down. The economy's slowing down. Inflation is lower. But what they're telling you about inflation is not what people generally think.

If you're not an economist, the less than 3 percent 2.9 inflation index doesn't really help you because it's still more expensive. Everyday things are getting more and more expensive. So just keep that in mind. When you buy a house, things are going to be more expensive because the valuation of the dollar going lower.

So what you could buy a house for 430, 415, 000 last year, two years ago, or three years ago is now a lot more difficult to attain rates are higher. The cost of money's higher valuation of the dollar is lower. So we think there's a lot of speculation. We're going to see these numbers continue for the next few years.

 

Home Inspection Checklist

That segment of this episode was brought to you by the home inspection checklist. You're thinking about selling your house or just want a honey-do list and want to look at every nook and cranny of your house to see what buyers and inspectors would look like. This list will help you get into the mode of what people would look at.

if you're thinking about selling in a year five years or five months, this list will help you get ready.

 

Understanding Mortgage Rates
So list the rates below 6% after you put in some points, You have to talk to a lender, or a broker, to see what's going on. But as long as you put in about a point or 1% of the loan you're looking at 8.75, 8.8, or 5.75, 5.8.  5.8, 5.0, you're below 9 percent or below 6%. And that's good news. Even though these are the rack rates right now, this is what's been quoted. You can still get it below 6 percent and the magic number is 5.5. That's When the majority of buyers will enter the market. If you put two points down, what would that look like?

If you're at five and a half percent. You're at your magic number. That's why I'm saying it's important for you to see that. And now that there are lower rates, more people are going to be in the market when more people are in the market means more competition. So now's a good time to buy, but be aware, find the houses that have been on the market for a little bit. 

Power Washing Your Home
If you're struggling to come up with a down payment, there shouldn't be any reasons why you should power wash your home. Your house will get dirty. Your house will get dusty. Your roof gets dusty. The gutter gets full of dirt. The walls and windows on the outside collect dirt over time and every year you should be spraying it down and knocking down some cobwebs and knocking down all that dust be careful because if you get the gas-powered ones you have to stand back a lot further because they're way more powerful than the little electric ones you can get at Home Depot or Harbor Freight.

Just make sure you know that if you see chipping paint it's a good indication that it's time to possibly repaint. And also allows you to clean up the entire yard, the exterior, plus the front yard and the backyard side yard. If you have cement, in California, especially here in the South Bay, South San Jose, right up against the hill.
When the wind picks up, we collect a lot of dust, this is a dry, arid area. You're going to have dust falling on your cars, on your sidewalks, on everything.

So just a good time to do a quick clean. Is it spring cleaning? No, it's August. I would do it once a year, not after the rains, but like right about now, September, when all the dust is starting to settle and you're expecting to see the rain come in September, October, and November.

And when your house is clean and shiny and sparkly after you power, wash it, guess what? It looks better. And it's more appealing to buyers.  

Real Estate in Santa Clara County
What'd you get for 2 million in Santa Clara County today? Cambrian area, Cambrian Alma den,

this house has been on the market for two days. It's listed at just under 2 million, three bedroom, two bath, not my listing. But if you're interested in looking at it, this is a good first-time home-buyer project. There's going to be some stuff that you need to fix This one is what you get for a million dollars.
there were 18 in Santa Clara County. or San Jose that's why I'm looking at this number right here, three bedrooms, one and a half bath, 1, 248 square feet built in 1972. List price decrease. Here's where they made a mistake. They are matching this up with single-family detached homes.

Clearly, it says it's an attached home, right? This means you have one wall. Let me show you right here. This is where the house is. This is one side of the house. This is the other side of the house. all of these homes. Right here are all duets. They're attached. They're single-family attached. They're two separate APNs or parcel numbers, but these houses will not sell for the same price as a single-family detached.

That's why you see this right here. You don't see a full picture of the house because it's attached and they're trying to get you to come and take a look at the house. Now it's upgraded inside. It's updated inside. That's great.

But you still have a neighbor that might be knocking on the door, knocking on the walls, and annoying when you look at this house, even though it's updated and upgraded, it's been on the market for how long? 16 days. They already decreased their price from 1.

5 down to 1. 05 whole hundred thousand dollars less. If it's something you're interested in let me know. Happy to help you understand the majority of these that I show you are not my listings. I'm just showing you what the market is looking like.  

Market Analysis and Conclusion
And here we go again. Nothing's really changed. I haven't even started looking at August yet, because typically the numbers don't smooth out. So if I did it, all the numbers would be way high, but that's alarming, The numbers are not changing at all.
And this chart here is just a reminder that we're not in a buyer's market, even though things are slowing down all across the Bay area, with houses that are selling in less than six months. means it's still a seller's market. This is Santa Clara County, single-family homes, and we're so far below the six-month mark that there's nothing really you can do.

It's a seller's market, even though the volume of units sold has slowed down. It's only because inventory is lacking, not because demand is down. Demand has shrunk because of the higher rates. It's made it a lot less affordable for people that make less than 300, 000 for the household.

But at the same time, they are still selling homes. yesterday we talked about who's buying these homes. We're talking about the tech workers that are making five, six, 700, 000, a million dollars a year. They're taking that extra cash and putting it into real estate. The majority of these homes that are being bought are second homes, investment homes.
They're just another part of the investment portfolio for those that have it. As well as the institutional buyers. We don't get a lot of those here in the Bay Area because they'd rather buy three and 400, 000 homes versus 2 million homes. So there you go. And if you want to look county or city to city within Santa Clara, we're nowhere near a seller's market because six months, we're just not seeing that.

And active number of homes is very low and the active number of homes right now is it's really hard for me to get to, but Santa Clara County is. About a thousand homes. We need to be about 2000 homes for it to be a balanced market. San Jose itself has 500 homes plus or minus.

We need to be about a thousand to make it a balanced market, not a buyer's or seller's market.   

Final Thoughts and Sign-Off

I am off to the beach this weekend. Hope you have a great weekend. I'm going to do some relaxing.

I'm Vito with Abitano. Thanks for watching.


Vito Scarnecchia Real Estate Broker, Veteran, Dad DRE#: 01407676 We’re Hiring! 408-705-6817 Vito@abitano.com Website: abitano.com https://www.onereal.com/vito-scarnecchia-1 update your home value: https://hmbt.co/bT7qRJ RELOCATION@ABITANO.COM FREE DESKTOP APPRAISAL https://www.propertyrate.com/agent/vitoscarnecchia If you are moving ANYWHERE in the world - Let me know! I know a LOT of AMAZING Agents! Book appointments here: https://calendly.com/abitano/15min Home Buyers Course YT YouTube.com/SanJoseLiving IG https://www.instagram.com/abitanogroup/ FB https://www.facebook.com/vito.scarnecchia/ LI https://www.linkedin.com/in/vito-scarnecchia/ Blog http://blog.abitano.com/ POD https://spotifyanchor-web.app.link/e/oxdH1Hwfcvb Professional Photography by Kim E https://photosbykime.com / Local Real Estate Market and Home Value Report https://hmbt.co/bT7qRJ Financial Intelligence https://docs.google.com/forms/d/e/1FAIpQLSc0R5pjHIAPguZ5GDEB-fTbGJXKpWK3coK9Khymv_GTWkMnyQ/viewform?usp=send_form https://www.onereal.com/vito-scarnecchia-1 Willow Glen's five most expensive homes https://youtu.be/3A_E2ck0ePg


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