2022 Fall Real Estate Report
What’s New in the Communities SLFCU Serves?
Home prices have started to drop as interest rates have increased from the previous year. For first-time home buyers, these higher interest rates are causing them to hesitate on purchasing a home, meaning houses are staying on the market longer than they were in 2021. However, for sellers, the rising interest rates means they’re not seeing the large profit gains sellers saw in 2021.1
A shortage of homes for purchase also continues to impact home buyers. As of July 2022, the U.S. was short 3.8 million housing units.2 While inventory is trending upwards, the nation continues to face a significant housing shortage. “The interest rate hike is not going to solve the housing crisis or shortage,” says Britt Harville, owner of Harville Realty and a HomeAdvantage® real estate agent. “It means that many first-time home buyers are going to shift their attention from buying to renting. As a result, rental prices are increasing substantially across the nation, making housing an even more attractive option for investors and thus making it more challenging for first-time home buyers,” he adds.
ALBUQUERQUE REMAINS “SOMEWHAT COMPETITIVE”
According to redfin.com, the Albuquerque housing market remains “somewhat competitive” with average homes selling about 2% above list price.3 “Homes priced at or under $350,000 are still seeing multiple offers,” says Britt. “In order to be competitive, buyers are waiving the appraisal and repair contingencies along with offering substantially more than list price in their offers. In some instances, buyers are contributing to closing costs that are customarily paid for by the sellers.”
“On the other hand,” he continues, “higher priced homes, particularly those listed at $500,000 or above, are remaining on the market for a greater period of time. To attract buyers, sellers at this price range are sometimes making dramatic price reductions, making significant repairs, or paying concessions at closing for them.”
FARMINGTON HOUSING MARKET FOLLOWS NATIONAL TRENDS
In line with nationwide trends, the Farmington housing market is seeing a decrease in home prices, an increase of days on market, and a decrease in active listings.4 The current median home listing price is $277,000, with homes remaining on the market for a median of 48 days.
“Heading into the fall, I think affordable homes will continue to see multiple offers, more expensive housing will remain on the market for a greater number of days, and sellers will possibly have to make concessions in price and repairs in order to sell and close them,” says Britt.
TRI-VALLEY REAL ESTATE MARKETS CONTINUE TO SLOW AND COOL
In the Tri-Valley, CA area, homes continue to sell quickly over asking price, with the number of new home listings decreasing about 14% in July 2022 compared to July 2021.5 The number of home sales in the Tri-Valley are also down – a decrease of 42% when compared to 2021 numbers. In line with national trends, homes in Livermore are staying on the market for longer – a median of nine days versus seven days in 2021. And while home prices in the area have increased 11.9% from 2021, they began decreasing in June 2022, for a current median sales price of $1,169,000.6
ADVICE FOR SELLERS AND BUYERS
For sellers, Britt recommends they prepare to stay on the market for a greater number of days (particularly for those with more expensive homes) and to expect to see offers that are less than list price. “If you are aware of any repairs that need to be addressed, take care of them prior to listing the home to improve how the home appears during showings and to maintain the buyer’s confidence once under contract,” he says.
For home buyers, Britt advises saving more than just the money needed for a down payment so they can address repairs a seller may be unwilling to make. “Affordable housing is still increasing in value, and taking on some repairs is worth the expense in terms of appreciation,”
"SLFCU offers a wide range of products for mortgage transactions, dependent on the members' needs," says Susan Rashad, SLFCU mortgage lending officer. "First time home buyers can obtain up to 97% financing without private mortgage insurance, a huge cost savings
to the member."
To learn more about SLFCU's home loan options and how they can save you money, visit slfcu.org/HomeLoans.
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