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Tri Valley Home Prices


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2022 Jun 25, 6:21am   623 views  13 comments

by BayArea   ➕follow (1)   💰tip ($0.10 in tips)  

I see our first MoM price drop in the Tri Valley (per Redfin)

My phone has been notifying me all week of price drops.

Homes that have sold this week look to be selling at near asking price, as opposed to $100-400k above.

House in our neighborhood has been for sale for several weeks, unheard of over the last couple years.

The number of homes for sale in the tri valley is multiples of what it was 6mo ago.

I also haven’t received our usual realtor fliers this month saying “look at this house I just sold for $300k above asking. I can sell yours too”

This is contradicting Zillow’s 1yr forecast that shows ~10% price increase in 2022, driven by demand still greatly exceeding supply.

Time will tell

Comments 1 - 13 of 13   

1   cisTits   2022 Jun 25, 9:08am  

Yup.
2   ad   2022 Jun 25, 10:43am  

I posted here BayArea says

This is contradicting Zillow’s 1yr forecast that shows ~10% price increase in 2022, driven by demand still greatly exceeding supply.


Zillow is a partner to the National Association of Realtors (NAR). They always have to forecast housing price inflation to motivate buyers to buy now, and not wait longer and longer in hopes home prices will drop further.
3   ad   2022 Jun 25, 10:45am  

BayArea says

Homes that have sold this week look to be selling at near asking price, as opposed to $100-400k above.


I figured if home prices are based on 2.75% rate for 30 year mortgage, then they have to drop at least 30% for a 6% rate.

That means return to 2020 levels for housing prices. We are already at summer 2020 levels for stocks. Housing trails stocks as far as price adjustments.

.
4   cisTits   2022 Jun 25, 10:48am  

ad says


I figured if home prices are based on 2.75% rate for 30 year mortgage, then they have to drop at least 30% for a 6% rate.

That means return to 2020 levels for housing prices. We are already at summer 2020 levels for stocks. Housing trails stocks as far as price adjustments.


Forgetting inflation, which is now costing the avg household ~$450/mo or higher. That eats into their potential house payment budget for home purchases.

Ppl have to eat and drive their car to work first, as priorities go.
5   ad   2022 Jun 25, 12:05pm  

HunterTits says

Ppl have to eat and drive their care to work first, as priorities go.


True, as I recall being told in summer of 2016 when securing a VA mortgage that housing costs (rent or ownership costs (mortgate/property taxes+insurance/hoa fee) are to be no more than 38% of household income).

Also, there will be major cut backs in discretionary spending in order to compensate for food price increases, etc.

.
6   GNL   2022 Jun 25, 12:21pm  

ad says

I posted here BayArea says


This is contradicting Zillow’s 1yr forecast that shows ~10% price increase in 2022, driven by demand still greatly exceeding supply.


Zillow is a partner to the National Association of Realtors (NAR). They always have to forecast housing price inflation to motivate buyers to buy now, and not wait longer and longer in hopes home prices will drop further.

They're partners? Can you prove that? I've never heard of that. In fact, most agents dislike zillow.
7   Eman   2022 Jun 25, 12:40pm  

BayArea says

I see our first MoM price drop in the Tri Valley (per Redfin)

This is contradicting Zillow’s 1yr forecast that shows ~10% price increase in 2022, driven by demand still greatly exceeding supply.


- More drops coming in the coming months and possibly years. This is my guess. Just like forecasting

- Zillow didn’t see inflation running hot, and I don’t think they foresaw 6% mortgage rate this year. Forecast is just that, forecast. No one has a crystal ball.

- My buddy, who works for the Federal Reserve, said the Fed is “projecting” to bring Fed fund rates back down to 2-2.25% by 2025. As of now, the target is 3.4% Fed fund rate by year end. This means 1.75% more rate hikes coming between now and year end. However, 30-year fixed mortgage rates have baked it in so they don’t foresee mortgage rates going higher than 6%.
8   GNL   2022 Jun 25, 1:49pm  

Eman says

BayArea says


I see our first MoM price drop in the Tri Valley (per Redfin)

This is contradicting Zillow’s 1yr forecast that shows ~10% price increase in 2022, driven by demand still greatly exceeding supply.


- More drops coming in the coming months and possibly years. This is my guess. Just like forecasting

- Zillow didn’t see inflation running hot, and I don’t think they foresaw 6% mortgage rate this year. Forecast is just that, forecast. No one has a crystal ball.

- My buddy, who works for the Federal Reserve, said the Fed is “projecting” to bring Fed fund rates back down to 2-2.25% by 2025. As of now, the target is 3.4% Fed fund rate by year end. This means 1.75% more rate hikes coming between now and year end. However, 30-year fixed mortgage rates have baked it in so they don’t foresee mortgage rates going higher than 6%.

So, according to your friend, best time to buy is probably 2024. Let high rate beat values down as much as possible -> buy -> refinance at 2% = lower payment + high value.
9   Tenpoundbass   2022 Jun 25, 1:55pm  

Until we get a President that will actually promote new Growth sectors and new boomtowns to have room to facilitate that growth.
Then the forces that are politically preventing new towns, and affordable options. Then the housing market will continue to condense to a few Investor companies owning it all.
The end goal is to create a sense that owning a house is hopeless unless you're a multi millionaire, even land will be unaffordable to the larger chunk of society.
Eventually people will warm up to a Chinese style and approach to Real Estate, where nobody really ever owns their house or property. But rather you lease it from the Government for 50 to 80 years. No legacy, no family land to hand down generations. You see the seeds of it being planted in the foolish stupid notion... (using my best squeaky annoying dipshit voice) "You don't really own your property, because you have to pay taxes..."
Nobody ever said that in the history of finances, as you can go buy land and build a house clear out in the boondocks, and not pay one single cent. No body in their right fucking mind would think, that all of the infrastructure and amenities provided by your State, County, or City should be free. But here we are!

Don't ever expect a housing collapse to the extent that we saw in 2007 through 2010. There wont be any ghost inventory of defaulted houses, they all will be scooped up by these investment companies. And when the next commie President pulls the trigger on the Great American landgrab, those investment companies will get well compensated for giving up their properties. There simply wont be any reason for the RE market to tank, it's not dependent on buyers, sellers or inventory anymore. It's fully supported by renters, AirBnB has more to do with RE market today, than Zillow does. The house across the street from me has flipped 2 times in the last year. It was never listed in the MLS. Not on Zillow or Trulia, investors bought it both times it sold.
10   B.A.C.A.H.   2022 Jun 25, 8:28pm  

BayArea says

House in our neighborhood has been for sale for several weeks

What would be fascinating, is if we could get a plot of days on market till sold, versus mortgage interest rate.
11   BayArea   2022 Jun 25, 8:54pm  

Agree
12   Patrick   2022 Jun 25, 8:59pm  

WineHorror1 says

They're partners? Can you prove that? I've never heard of that. In fact, most agents dislike zillow.


I haven't heard about Zillow being a partner of the NAR, but Zillow definitely makes its money by referring buyers to realtors. The realtors pay for a supply of naive buyers.
13   GNL   2022 Jun 25, 9:09pm  

Patrick says

WineHorror1 says


They're partners? Can you prove that? I've never heard of that. In fact, most agents dislike zillow.


I haven't heard about Zillow being a partner of the NAR, but Zillow definitely makes its money by referring buyers to realtors. The realtors pay for a supply of naive buyers.

Yes, I understand that. In fact, I know a Realtor that pays $50,000 a year for Zillow leads.

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