How is the current real estate market? What is the real estate market doing right now? In this real estate market update, I discuss the local real estate market and give you my take on the current housing market and what we should expect over the next few months.
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Hey guys, welcome back. Jeb Smith, Coldwell Banker Realty here in Huntington beach, California and back with your March 2020 real estate market update. We’re now moving in to the end of the first quarter, if you will, so it’s the third month of the first quarter. What has changed in the market from January to now, year over year, what are the big differences in our real estate market? That’s what we’re going to talk about today. The big change this year is that our market is as hot as it’s been in the last say five years. Inventory is very, very low. Buyer demand is really, really high. What I mean by inventory is low, the number of available properties for sale on the market are really low. I think we’ve only seen a 3 or 4% increase up to this point in the year with only about 4,000 active homes on the market in all of Orange County.
There’s not a lot of property to choose from and because interest rates are so low, buyer demand has skyrocketed. It’s really the driving force behind this resurgence, if you will, in inactivity and what’s really propelling the market forward. Over the last couple of days, we’ve seen the market drop a thousand points and six, 700 points, what have you in a couple of days. Bonds are really low, the 10 year is going low. In theory, that’s going to make interest rates follow. So interest rates will likely stay at this level for some time, which will keep buyers out there looking and in potentially moving the market upwards as we move in further into the spring market, into our summer market. But the one thing we’re lacking is property and because of that lack of property, we’re seeing multiple offers on the properties that come to the market.
We’re seeing the next property that comes on the market after the last one sold at a higher price. It’s really this, it’s not a bubble, but it is something that we’re watching because it’s starting to get a bit out of control with regards to pricing and it’s really hard to compete if you’re a buyer out there in that say 500 to $800,000 price point because there’s a lot of buyers out there looking. You have a lot of competition, you have a lot of people that are looking exactly for what you are looking for. So every offer that you put in, chances are there multiple offers, especially if it’s priced anywhere close to market value. It’s really tough on buyers, there’s a lot of buyers out there getting frustrated, a lot of buyers out there settling on property that they wouldn’t have considered initially.
My advice is hang tight, don’t settle on a property that doesn’t fit exactly what you’re looking for. I know you’re not going to get a 10 out of 10 in most cases of what you’re looking for in a home. But at the same time, don’t settle on something just to buy a house. More property will come to the market, you’ll have more opportunities to get in there. It’s hard to be patient in a market like this where you’re seeing property values continue to go up and every property you put an offer in on, goes above asking price with multiple offers. But at the same time, what I will tell you is that at some point this will calm down, things will flatten out, you’ll have an opportunity to get back into the market.
Not to say that you shouldn’t put an offer in, I’m just saying don’t settle on something that doesn’t fit the box, fit what you’re looking for. With regards to sellers, it’s one of those things that, if you’ve held out of the market for any reason, chances are you’re getting more money for your property now than you would say six months ago or a month ago or two months ago or what have you. So the longer you’re waiting as a seller, in theory, the more money you’re getting. But at the same time, this isn’t going to hold up forever. You’re in a really good market right now to sell because there’s not a lot of inventory, not a lot of competition, and buyer demand is really, really high with low interest rates.
So keep that in mind, if you’re a seller, thinking about getting into the market, talk to an agent now, find out what your property’s worth, find out what you need to do in order to get it on the market, find out what they think it could sell for in what timeframe, et cetera. Because right now, things are moving along nicely and we expect this to continue as we move into the summertime, at which point things will probably slow down as we move further into summer. It’s an election year, just because it’s an election year doesn’t mean things are going to crash or completely change, but people are probably going to be more cautious as we move into that time because they don’t know what to expect, right? We’re in a position right now where we don’t know who the democratic nominee is going to be and let’s be honest, that is a factor. Depending on who gets elected there that could change the market from the market that we’re currently in, and this isn’t a political statement, it’s fact.
I mean a change in presidency will likely change the market, which in point may cause the market to pull back, could cause interest rates to move higher, the stock market can move down. A lot of things could happen, a lot of reshuffling of funds, so at end of the day you don’t know what’s going to happen. We are due for some pullback just because of the incline that we’ve been on for so long, but the fundamentals of the economy look pretty good. Low inventory, high buyer demand, really low interest rates. So the factors are there, consumer confidence just came back, it wasn’t great, but there’s a lot going on with coronavirus and all of these things in the economy. So just pay attention to it, just make sure you’re up to date on what’s going on in the market.
As I’ve said before, if you find a property you like, you’re going to be there for the next five, seven years, now’s a great time. Interest rates are really low, money’s basically free. Don’t miss an opportunity thinking that the market’s going to pull back 10, 15% and miss another 5, 10% or rise in the market while you’re waiting. There’s a lot of those people still sitting on the sidelines from 2014, 2015 saying the market was going to crash. They never got in, they never got a chance to get back in because the market continued to propel forward. A lot of people are saying that this market continues into 2021, potentially 2022 depending on what happens with that election. It’s a good time as any if you find the right property to make that move. If you’re considering selling, there’s a lot of factors working in your favor at the moment that I mentioned earlier.
But if you do have questions, do me a favor, comment below. I love to see your feedback, I love to address questions. There’s a lot of naysayers out there and I’m sure I’ll get that as well. But it’s a strong market, it’s not a bubble. Even if we do pull back sometime in the next couple of years, there’s still a lot of buyers out there looking, there’s still a lot of opportunity in the market. So again, I appreciate you taking the time to watch. I’m here if you have questions, feel free to reach out to me directly, or comment below. As always, I appreciate you taking the time to watch and we’ll see you again soon. Have a great day, bye bye.
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