Bay Area home sales declined by 20 percent year over year in September, with all counties posting drops, led by Sonoma and Contra Costa. In 2018, the region’s housing market activity is trending 4 percent lower year to date.
Santa Clara County posted sales declines across all price ranges.
Bay Area inventory increased by 14 percent year over year in September — about 2,000 more homes — with Santa Clara County contributing more than 50 percent to the total increase.
While appreciation has slowed from its spring peaks, Bay Area home prices are still up by 10 percent on an annual basis. San Mateo County maintained the strongest price growth at 19 percent.
Home price reductions were up by 7 percentage points, from 16 percent last year to 23 percent this September. Sonoma and Santa Clara counties posted the largest increases in price reductions.
The rebalancing between buyers and sellers is driven by affordability constrains and buyer fatigue, with the biggest change seen in relatively affordable and previously fiercely competitive markets.
The slowdown in the past 6 months is more than seasonal adjustment. If inventory stays high until January, we may have y/y price declines in the spring
As of today, SCC has 55 days of inventory and price decline is already significant. I think it we have 90 days of inventory, it would cause a lot of price damage.
But fundamentally there is no job loss so it is possible that sellers may push back and simply take it off the market. We have a weak demand due to affordability, but there is no seller pressure yet.
I think price peak has passed. The best we can hope is a market that is flat or grows with inflation.
Mortgage rate increase may end next year. The big question is whether and when big tech layoff will start.
DOM is more critical than inventory. Still very low compared to national average. Even in bad times it was relatively low in the BA. Wasn’t easy to pick bargains even in 2010.
Only desperate sellers will give up in the next 5 years, even if prices drop. The DDD sellers will get hurt. But demand is still there and supply will always be limited
I wonder if all the investors on here will be happy with 0 appreciation and slowly dropping rents for the next 5 years. If they start selling the market could drop.
The FOMO is gone. There’s no urgency on the buyers part so first sales and later prices likely will head south. Yes people have jobs and make money, but are they making enough? As shown by the Dropbox wnginner’s essay I linked to earlier, many conclude it makes better financial sense to rent.
If people warm up more to stocks, if stock market starts going up again which seems to be consensus here, people will put more money in stock market, further dampening housing gains.
Flippers and foreign buyers left the market. Looks like investors on here are on the fence. Prop 10 could hurt the market. But if rents keep going up, more buyers will appear.
