Hello Friends & Neighbors
I’m getting a lot of questions from my clients about the real estate market right now, so I thought I would share the most recent numbers and some of my insights with you. For those that don’t know me, I’ve sold over $140-million in real estate, and work at RE/MAX Accord, one of the larger Brokerages in the East Bay Area. I’ve also lived in Pleasant Hill since 1970.
Current Market
Yes, we are still in a seller’s market – lots of demand, but not enough homes for all of the buyers. 2023 saw a big change vs 2022 … Prices have remained somewhat stable (about a 3% drop from 2022 to 2023 prices). The big news is the interest rates … the interest rates jumping up have resulted in SELLERS not wanting to sell – because they would end up paying MORE for a replacement home – the majority of potential sellers have a mortgage rate that is too good to give up. They are currently paying 3% (or less). They would have to pay 6% to 7% on a new loan.
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If they move, these higher interest rates could translate to an increase of $10,000 or $20,000 per year (or more) on a new mortgage. This has dramatically cut the number of homes on the market available for sale.
Current Rates & Stats
Here is a quick example of the difference in the monthly payments on a 30-year fixed-rate loan at 3% vs 6% vs 7%
Loan Amount
A. $ 500,000
B. $ 800,000
C. $1,000,000
3% Interest
A. $ 2,108 / mo
B. $ 3,373 / mo
C. $ 4,216 / mo
6% Interest
A. $ 2,998 / mo
B. $ 4,796 / mo
C. $ 5,996 / mo
7% Interest
A. $ 3,327 / mo
B. $ 5,322 / mo
C. $ 6,653 / mo