If you’re thinking about buying or selling a home soon, you probably want to know what you can expect from the housing market this year. In 2022, the market underwent a major shift as economic uncertainty and higher mortgage rates reduced buyer demand, slowed the pace of home sales, and moderated home prices. But what about 2023?
An article from HousingWire offers this perspective:
“The red-hot housing market of the past 2 ½ years was characterized by sub-three percent mortgage rates, fast-paced bidding wars and record-low inventory. But more recently, market conditions have done an about-face. . . . now is the opportunity for everyone to become re-educated about what a ‘typical’ housing market looks like.”
This year, experts agree we may see the return of greater stability and predictability in the housing market if inflation continues to ease and mortgage rates stabilize. Here’s what they have to say.
The 2023 forecast from the National Association of Realtors (NAR) says:
“While 2022 may be remembered as a year of housing volatility, 2023 likely will become a year of long-lost normalcy returning to the market, . . . mortgage rates are expected to stabilize while home sales and prices moderate after recent highs, . . .”
Danielle Hale, Chief Economist at realtor.com, adds:
“. . . buyers will not face the extreme competition that was commonplace over the past few years.”
Lawrence Yun, Chief Economist at NAR, explains home prices will vary by local area, but will net neutral nationwide as the market continues to adjust:
“After a big boom over the past two years, there will essentially be no change nationally . . . Half of the country may experience small price gains, while the other half may see slight price declines.”
Mark Fleming, Chief Economist at First American, says:
“The housing market, once adjusted to the new normal of higher mortgage rates, will benefit from continued strong demographic-driven demand relative to an overall, long-run shortage of supply.”
Bottom Line
If you’re looking to buy or sell a home this year, the best way to ensure you’re up to date on the latest market insights is to partner with a trusted real estate advisor.
The Caton Team is here to help. Our Silicon Valley Market is unique, so if you’re thinking of buying or selling – let’s chat about your options.
Got Questions? The Caton Team is here to help.
Call| Text | Sabrina 650.799.4333 |EMAIL | WEB| BLOG
We love what we do and would love to help you navigate your sale or purchase of Residential Real Estate. Please reach out at your convenience for a personal consultation. Please enjoy our free resources below and get to know our team through our clients’ words.Testimonials.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
The Caton Team loves helping buyers find their homes. Whether it be their first purchase or not, we take the time to educate our clients on how to tackle the current market and achieve their Real Estate related goals.
With interest rates up over last January – the effects are felt and seen across the board. But let’s not be discouraged. If your goal is to own a piece of California – let’s reevaluate the budget, check out all loan programs, and see what areas the budget fits. Then determine if the homes in that budget are workable for your goals. It sounds like a lot, but we break down each step into doable tasks to help you achieve your Real Estate goals.
Thoughts for Sellers….
If you’re considering a sale, the news of higher rates may create some fear that your home’s equity is falling. Yes, sales prices from last year have reflected about a 10% decrease in sold data – but some of that is seasonal and some of that is related to rates.
When rates go up, a buyer’s purchase power goes down and their ability to overbid is hindered.
Depending on when you bought your home, and how much equity you have – there may be an impact on your takeaway. But before you give up – let’s take a look at the big picture. Where you are relocating? Why you are selling? All these details matter.
It’s best to see where the value of your home is today and determine if your takeaway will help you achieve your next goal and if not – let’s plan. If the budget is right – selling now may be the right step as inventory is low.
Each client’s journey is unique. The Caton Team prides ourselves on helping our clients achieve their Real Estate goals – no matter the market conditions.
How can The Caton Team help YOU?
Contact The Caton Team for a free consultation.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL|
Get to know The Caton Team through our clients words…
“As first-time homebuyers we knew very little about the process, what to expect, or how long it might take, so we leaned heavily on the Caton Team’s expertise to get us up to speed and to help us navigate through the hurdles. As it turned out, we hit a pretty major snag that could have derailed our purchase, but with the Caton Team counseling patience and practicing tenacity, we were able to successfully purchase our forever home. We really appreciated Susan and Sabrina’s transparent, professional, and forthright approach. I don’t think we would have landed where we are without them.”
– Kyriell & Shane – 2022 – San Francisco.
THANK YOU Shane & Kyriell – Your kind words mean the world to us. We truly enjoyed getting to know you both and helping you achieve your goal of owning a piece of San Francisco. We started our journey early in 2022 – before the rate hike and after one offer experience, they were better poised to act on their actual dream home. Up against other offers, we set our clients apart. When a surprise nearly derailed their dream, we used kindness, patience, and solid business practices to smooth out the wrinkles and bring this transaction to a successful and happy conclusion – it’s what we do. Handing you the keys made my day. Thank you for your trust – we truly enjoyed working with you both.
We love what we do and we love taking great care of our clients.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
We’ve come to accept interest rates are not going to be 3% for a while. The good news is – this week – mid-Jan 2023 – rates are the lowest they’ve been in months. Rates change daily – so it’s best to speak to your lender directly.
What I can say – I’m seeing my buyers reapply for loans and start new budget talks around the kitchen table. There has always been an excess of demand in the Bay Area and a shortage of housing supply. So that’s good news for sellers and owners. I do see sale prices adjust accordingly but I don’t see a crash. I’m thinking we’ll have normal growth – which is better than hyper-appreciation.
The rate hike did what it was supposed to – temper the market. With its ups and downs, the data shows one thing – home values in the San Francisco Bay Area have appreciated since 1849. Buyers – this may be the market we’ve been waiting a decade for.
So, time to accept reality – re-evaluate the budget and cross-examine what homes are currently on the market. The Winter season in Real Estate has always been slow. Homes on the market now need to sell and if you’re the only offer on the table – you could have terms in your contract – a contingency even. Imagine that? Remember buyers – buy low, sell high. Marry the House, Date the Rate – just Get The House. Real Estate is an important long-term investment. You can always refinance your loan when rates go down again.
Today, I’m seeing my sellers who can wait, gear up for Spring, and prepare their homes for the market. Paint, flooring, packing, cleaning. This is the season for that as we enjoy the rain we’ve been hoping for.
For my buyers out there, don’t give up on the dream. Let’s re-evaluate the loan and monthly costs, see what properties fit our needs, and take it from there.
For my sellers, your timing is everything. Where are you going and when do you need to get there? The rest, we’ll figure out together – because that’s what we do.
The Caton Team is here to weather any storm and help our clients achieve their Real Estate Goals. How can we help you? Reach out.
The Caton Team | Call|Text 650.799.4333 or Email | Info@TheCatonTeam.com
Previous articles…
Update – Fall 2022.
Quick Read:
Well, rates went up again. This shakes things up for buyers, how much they can afford and that will impact home values over time.
This – for buyers – is exciting because – if you can buy a home for less – you can always REFINANCE out of that high rate when rates go down! So Marry the House – Date the Rate!
Each market is impacted differently – if you’re thinking about selling and buying – The Caton Team is here to guide you. We’ve worked through several different market dynamics and have the wisdom and knowledge to aid us. Reach out – we’re happy to help.
The Caton Team | Call|Text 650.799.4333 or Email | Info@TheCatonTeam.com
Long Read:
Right now, Realtors and their buyers are reworking the numbers, trying to stay within their budget and readjust their plans to accommodate for higher interest rates. Sometimes the goal changes, and sometimes there is a silver lining.
For buyers in Silicon Valley – anyone shopping for a home since 2020 – had low rates, lots of competition, and overbidding. When rates went up – buyers lost their purchase power and it was back to the drawing board – determining their new budget and how that translates into homes. The sellers felt it as offers dried up and escrows didn’t close.
It’s going to take some time to hash out but life doesn’t stop.
With higher rates – buyers can afford less, so eventually, that will impact home sales and prices. But for an agent who’s always working with buyers – as scary as this all seems – this is the market we’ve been waiting for!
There are going to be homes that need to sell, job transfers, weddings, and babies – life events trigger moving events – no matter the market. So for the well-prepared buyer, even with higher rates – this is a rare opportunity to be – dare I say – the only offer on the table? This is where the real negotiating happens. Finding that middle ground where the buyer can buy and afford their home and the seller gets what they need to move forward with their lives. It’s the sweet spot.
If you’re a homeowner with no need to move – this doesn’t hurt you – it is all part of the normal business cycle. However, if you’re a homeowner who has to sell – well – some of your equity is lost for now. So if selling is a must – let’s sit down and chat about your goals and how we can make them happen. Because homes are still selling.
What we are seeing is a shift to a buyer market, if a seller wants their price and a buyer can’t go that high, the buyer is moving on to the next. There are options out there, homes that need to sell, and price reductions galore. And if that is not enough incentive – I’ll say it – just offer a fair price. Finding that middle ground doesn’t have to be a mystery.
For buyers – this is a wonderful time to prepare. Get your loan approved, and understand your budget and the impact of the Interest Rate. Are there homes within reach? Then go for it? If not – then save and wait but keep that goal in mind. SAVE SAVE SAVE!
Now here’s the golden rule – Marry the House – Date the Rate. If you can afford any Real Estate in the Bay Area – even if it is not your dream house – buy it. Hold it and when the rates go down – refinance – and when the home values go up-sell and make your move. This is how it is done, the old advice – Buy Low Sell High – applies.
So how low will it go? Not that low. Let’s stay realistic – we’re not dropping to 1990 prices – but we will see prices reflect the higher rate.
Truthfully – for buyers – this is exciting because – if you can buy a home for less – you can always REFINANCE out of that high rate when rates go down! So Marry the House – Date the Rate! I said it three times – it’s gotta be ringing in your ears by now.
Each market is impacted differently – if you’re thinking about selling and buying – The Caton Team is here to guide you. We’ve worked through several different market dynamics and have the wisdom and knowledge to aid us and better serve you. Reach out – we’re happy to help.
The Caton Team | Call|Text 650.799.4333 or Email | Info@TheCatonTeam.com
Previous Article…
It’s the middle of 2022. The “Pandemic Real Estate” seems to have simmered down with the rate hike as we watch prices adjust. With so much chatter about “this crazy market”, I thought I’d share my insight.
Interest Rates go up and down. That’s what they do, and rates will continue to do so. We don’t control the rates. As it fluctuates – it is wise to consider saving to buy down your rate and when budgeting – round up to account for a higher rate. I prefer knowing if I lock a lower rate – I’m more than comfortable with my payments.
Back in the 80’s rates for home loans were 13%. Back in the early 2000s, we were around 5%, then we dipped down to 3% and life was good.
Now that rates are dancing around 4.5-5% over the past few weeks – we are experiencing two phenomena. Well-positioned homes are still seeing multiple offers and over-list price sales while some homes are dropping their price to garnish more viewers.
I’ve had some clients jump into getting approved – knowing when the market “slows down” they have a better chance of getting a home. I also see some clients stalling, a wait-and-see approach. Especially when a lot of “down payment funds” are tied up in stocks – those clients are forced to wait.
But if there is one thing I want to make clear – in the Bay Area – this was and is not a crazy market. This IS our market.
The San Francisco Peninsula – Silicon Valley – has had limited inventory for sale at any given time. I’ve been a full-time Realtor for going on 19 years now and we’ve always had limited inventory – thus the overbidding. Coupled with high salaries and when the Stock Market is robust – there is no stopping the Real Estate Market around here. This has fueled our prices, the over-bidding with the already low inventory – it’s classic
Supply & Demand.
What I do know – everyone needs somewhere to live and owning your own place is the best way to keep a roof over your head and create long-term wealth. Real Estate is the only investment you can live in. Real Estate prices may flux month over month, year over year – but decade over decade – Real Estate will appreciate. They have since 1849…
I am no economist and I too am glued to the news about our economy, interest rates, inflation, and gas prices. All this will be represented in Real Estate and why long-term vision is key.
Let’s look at the big picture – a few questions to help you determine your course.
Do you want to live in the Bay Area?
Is your job in the Bay Area?
Do you want long-term financial security?
Do you want to stop worrying about your rent going up?
Do you have assets to invest in?
If your answer is yes, – you want to own a piece of Silicon Valley – contact The Caton Team. We’re happy to guide you through the steps of homeownership. If you’re not ready to buy today – we’ll let you know what it takes so you can plan.
I became a Realtor because, as a first-generation American, I understood what the American Dream was and it is grounded in Real Estate.
If you are considering a sale or purchase of Real Estate – The Caton Team would love to interview for the job as your Realtor. We love what we do, let us take care of you.
We believe to be successful in the Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with integrity, while strategically maneuvering through negotiations and contracts.
A mother and daughter-in-law team with 40 years of combined, local real estate experience, knowledge, and know-how – wouldn’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time. Call | Text | 650.799.4333 | Email | Info@TheCatonTeam.com
Effective. Efficient. Responsive. Got Questions? The Caton Team is here to help.
Call| Text | Sabrina 650.799.4333 |EMAIL | WEB| BLOG
We love what we do and would love to help you navigate your sale or purchase of Residential Real Estate. Please reach out for a personal consultation. Please enjoy our free resources below and get to know our team from our TESTIMONIALS.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral, or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – wouldn’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
A little over a decade ago, about half of homes were being sold to first-time buyers.
Things have changed.
Now, only 27% of sold homes are going to first-time buyers. It isn’t that people aren’t interested in purchasing a home – after all, demand for homes was turbocharged during the course of the COVID-19 pandemic.
But first-time homebuyers are having an exceptionally hard time breaking into the market. What gives? Why are a record low proportion of properties being sold to people buying their first home?
1. High Price of Homes
The first reason first-time homebuyers are having a hard time accessing the market is the sky-high price of homes.
Home prices have risen nearly 20% in the past year – representing an unusual and historic surge that disadvantages first-time buyers, who are typically younger, haven’t accumulated housing equity, and don’t have the means to make a sizable down payment.
Whether rising home prices will abate at some point this year is hotly debated, but the price of homes has been juiced by three interrelated factors:
Inventory: Housing inventory remains at a record low, and continued supply chain bottlenecks leaves most experts predicting low inventory for the foreseeable future.
Investors: Investors buy about one-third of homes in the U.S., increasing competition for available homes. Rising inflation could cause even more investors to flood the housing market, as real estate is traditionally seen as a safe investment against devalued currency.
Overall, rising prices is the biggest challenge for anyone – especially those making their first purchase – who wants to buy a home.
2. Rising Interest and Mortgage Rates
The high price of homes alone serves as an impediment for first-time homebuyers. But it’s not the only factor boxing first-time buyers out of the real estate market.
Consider a couple buying their first home. They’re targeting a mortgage of $200,000, which is already far lower than the median in many markets. Rising interest rates, which the Federal Reserve introduced to tamp down inflation, have risen from 2.6% to around 5% in the past 16 months. The $200,000 mortgage the buyers are targeting? It’s now more than $200 per month more expensive than it would have been 16 months ago.
As if rising home prices and steeper mortgage rates weren’t enough, first-time homebuyers also face the new challenge of apparently slower wage growth.
In the wake of the COVID-19 pandemic, government stimulus, and a historically tight labor market, American wages grew fast. But that wage growth has cooled somewhat in the early part of 2022, with more people working or looking for work and employers feeling less pressure to offer pay increases to bring people into the labor force.
Slower wage growth may be a relief to people concerned about inflation, but is in the short-term a major difficulty for homebuyers, especially those purchasing for the first time. Wages are generally not keeping pace with inflation, and the preexisting high price of homes and rising mortgage rates mean that many young buyers are less equipped to buy than they were months ago.
For the immediate future, first-time homebuyers are likely to struggle to enter the housing market. In the long term, tapering home prices and mortgage rates and increased inventory could make for a friendlier first-time homebuyer market.
To view the original article, visit the Homesnap blog.
It can feel daunting but it isn’t. It is a journey. The Caton Team believes in Home Ownership for long term wealth and are here every step of the way.
The Caton Team is here to help.
We love what we do and would love to help you navigate your sale or purchase of residential Real Estate. Please reach out at your convenience for a personal consultation. Please enjoy our free resources below and get to know our team through our clients’ words.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
Buying your first home is a major decision and an exciting milestone. Even though it can feel daunting at times, it has the power to change your life for the better. If you’re looking to purchase your first home, you may be wondering what’s happening in the housing market today, how much you need to save, and where to start.
Here are three things that can help give you the information you need to confidently pursue your dream of homeownership.
1. Consider All Options When the Number of Homes for Sale Is Low
Today, there are far more buyers in the market than there are homes available for sale. When that happens, it’s a good idea to do what you can to increase your pool of options. That could mean expanding your search to include additional housing types. For first-time buyers, considering condominiums (condos) and townhomes can be an excellent way to increase your choices. According to Bankrate:
“Townhomes often cost less than single-family homes of a similar size in the same location.”
“Buying a condo can be a great way to dive into homeownership without worrying about the upkeep that comes with single-family homes and townhouses.”
Condos and townhomes are both great entryways into homeownership. When you buy either one, you can start building equity which increases your net worth and can fuel a future move.
2. Know Your Down Payment Could Be More Within Reach Than You Think
Saving for a down payment can feel like one of the biggest obstacles for homebuyers, but that doesn’t have to be the case. As the National Association of Realtors (NAR) says:
“One of the biggest misconceptions among housing consumers is what the typical down payment is and what amount is needed to enter homeownership.”
Based on the data above, the median down payment for all homebuyers is only 13%. That’s well below the common misconception of 20%, and it’s even lower for younger buyers. This could mean you may not need to save as much for a down payment as you initially thought.
There are also down payment assistance programs available for many buyers. Not to mention, some loan options require as little as 3.5% (or even 0%) down for buyers who qualify. While there are advantages to putting 20% down, especially in today’s competitive market, know that you have options. To get more information on how much you may need to save and the help that’s available, talk with a professional.
3. Work with a Trusted Real Estate Advisor Throughout the Process
Finally, no matter where you’re at in your homeownership journey, the best way to make sure you’re set up for success is to work with a real estate professional.
If you’re just starting out, they can help you with the initial steps, like educating you on the process and connecting you with a trusted lender to get pre-approved. Once you’re ready to begin your search, a real estate professional can help you understand your local market and search for available homes. And when it’s time to make an offer, they’ll be an expert advisor and negotiator to help your offer stand out above the rest.
Bottom Line
Knowledge is key to succeeding on your homebuying journey. Knowing market trends, what you need for a down payment, and what options you have as a buyer today can give you the confidence you need to buy a home. Connect with a local real estate professional so you have an expert on your side who can help you navigate the homebuying process.
The Caton Team is here to help.
We love what we do and would love to help you navigate your sale or purchase of Residential Real Estate. Please reach out at your convenience for a personal consultation. Please enjoy our free resources below and get to know our team through our clients’ words.Testinmonials.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
Connect with a local real estate professional so you can make your best move this year.
The Caton Team is here to help.
Each market and client is unique – we love what we do and would love to help you navigate your sale or purchase of Residential Real Estate. Please reach out at your convenience for a personal consultation. Please enjoy our free resources below and get to know our team through our clients’ words.Testinmonials.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
If you’re planning to buy a home, it’s critical to understand the relationship between mortgage rates and your purchasing power. Purchasing power is the amount of home you can afford to buy that’s within your financial reach. Mortgage rates directly impact the monthly payment you’ll have on the home you purchase. So, when rates rise, so does the monthly payment you’re able to lock in on your home loan. In a rising-rate environment like we’re in today, that could limit your future purchasing power.
Today, the average 30-year fixed mortgage rate is above 5%, and in the near term, experts say that’ll likely go up in the months ahead. You have the opportunity to get ahead of that increase if you buy now before that impacts your purchasing power.
Mortgage Rates Play a Large Role in Your Home Search
The chart below can help you understand the general relationship between mortgage rates and a typical monthly mortgage payment within a range of loan amounts. Let’s say your budget allows for a monthly mortgage payment in the $2,100-$2,200 range. The green in the chart indicates a payment within that range, while the red is a payment that exceeds it (see chart below):
As the chart shows, you’re more likely to exceed your target payment range as mortgage rates increase unless you pursue a lower home loan amount. If you’re ready to buy a home, use this as your motivation to purchase now so you can get ahead of rising rates before you have to make the decision to decrease what you borrow in order to stay comfortably within your budget.
Work with Trusted Advisors To Know Your Budget and Make a Plan
It’s critical to keep your budget top of mind as you’re searching for a home. Danielle Hale, Chief Economist at realtor.com, puts it best, advising that buyers should:
“Get preapproved with where rates are today, but also consider what would happen if rates were to go up, say another quarter of a point, . . . Know what that would do to your monthly costs and how comfortable you are with that, so that if rates do move higher, you already know how you need to adjust in response.”
No matter what, the best strategy is to work with your real estate advisor and a trusted lender to create a plan that takes rising mortgage rates into consideration. Together, you can look at your budget based on where rates are today and craft a strategy so you’re ready to adjust as rates change.
Bottom Line
Even small increases in mortgage rates can impact your purchasing power. If you’re in the process of buying a home, it’s more important than ever to have a strong plan. Partner with a trusted real estate advisor and lender to strategize so you can achieve your dream of homeownership this season.
The Caton Team is here help.
We love what we do and would love to help you – please reach out at your convenience and enjoy our resources below. Get to know our team through our clients words.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
Many people are wondering: will home prices fall this year? Whether you’re a potential homebuyer, seller, or both, the answer to this question matters for you. Let’s break down what’s happening with home prices, where experts say they’re headed, and how this impacts your homeownership goals.
“Price appreciation averaged 15% for the full year of 2021, up from the 2020 full year average of 6%.”
So why are prices climbing so much? It’s because there are more buyers than there are homes for sale. This imbalance is expected to maintain that upward pressure on home prices because homes for sale are a hot commodity in today’s low-inventory housing market.
Where Do Experts Say Prices Will Go from Here?
Experts say the housing market isn’t set up for a price decline due to that ongoing imbalance between supply and demand. In the latest home price forecasts for 2022, they’re calling for ongoing appreciation throughout the year (see graph below):
While the experts are forecasting more moderate price appreciation, the 2022 projections show price gains will remain strong throughout this year. First Americanexplains it like this:
“While house price growth is expected to moderate from the rapid pace of 2021, strong home buyer demand against a backdrop of historically tight inventory of homes for sale will likely keep appreciation positive in the coming year.”
What Does That Mean for You?
The biggest takeaway is that none of the experts are projecting depreciation. If you’re a homeowner thinking about selling, the higher price appreciation over the last two years has been great for your home’s value, but it’s also something you should factor in when planning your next steps. If you’ll also be buying a home after selling your current house, you shouldn’t wait for prices to fall. Waiting will only cost you more in the long run because climbing mortgage rates and rising home prices will have an impact on your next home purchase. Freddie Macsays:
“If you’re thinking about waiting until next year and that maybe rates are higher, but you’ll get a deal on prices – well that’s risky. It may be more advantageous to purchase this year relative to waiting until 2023 at this time.”
Bottom Line
If you’re thinking of selling to move up, you shouldn’t wait for prices to fall. Experts say prices will continue to appreciate this year. That means, if you’re ready, buying your next home before prices climb further may make the most financial sense. Partner with a real estate professional to begin the process of selling your current home and looking for your next one before prices rise higher.
How can The Caton Team help You?
Turning Real Estate Goals into Reality
The Caton Team loves what we do and would love to help you – please enjoy our resources below and get to know our team through our clients words.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
When our friends referred their friends to us – we were so excited. Having trust built into our relationship due to a referral makes our job so much easier. We’re able to have the market conversation. We’re able to discuss expectations and goals. With a budget and the want list – quickly – we were able to hammer out the best route. This time, we added a local agent to the mix, to help us with their market dynamics. Each area has its own customs, expectations, and market flow – local insight proved very helpful.
I’m proud to say Milford and DaShanna were able to get their first offer accepted in a market where competition is fierce!
Thank you Mike Kamienski of Welcome Home Funding for taking GREAT care of our clients AND closing very quickly! Contact Mike Anytime @ (650) 484-6488 | mike.kamienski@whfunding.com)
This was a win-win for The Caton Team!
How can we help you? Reach out anytime -@ Info@TheCatonTeam.com
If you’re considering a sale or purchase of Real Estate in the Bay Area – you need a full-time, professional Realtor to guide you. The Caton Team would love to interview for the job as your Realtor Team – please reach out at your convenience.
Call | Text 650.799.4333 Email | Info@TheCatonTeam.com | Testimonials
We love what we do! How Can the Caton Team Help You?
Turning Real Estate Goals into Reality – Even Mid-Pandemic
How can The Caton Team help You?
We truly enjoyed helping our first time Buyers find a better suited space for thier lives – mid-pandemic. The Caton Team loves what we do and would love to help you – please enjoy our resources below. Get to know us at through our clients words.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
The best part of being a Realtor – is working with my friends. Anthony and I go way back to our banker/college days. When the time came for his wife J’Risha and he to buy their first home, I was honored when they called me.
We had some quick thinking to do. We had a budget, the needs and want list, and a really good opportunity in a new development. The Caton Team had our work cut out for us. Thankfully we were well vested in the East Bay market having just found a wonderful townhome for our clients. Knowing what Anthony and J’Risha wanted and needed – we crunched the data and sent over the numbers. The trust we had over years of friendship, the knowledge we had working in the East Bay, and the fabulous news of what county our loan was in – it was clear – new homes – here we come!
Pandemic, builder shortages, deadlines, missed deadlines, appraisals, inspections, and re-inspection – finally, the day came where these two friends turned into California Home Owners.
CONGRATULATIONS Anthony & J’Risha
We love what we do! How Can the Caton Team Help You?
Turning Real Estate Goals into Reality
How can The Caton Team help You?
We truly enjoyed helping our clients sell their home – mid-pandemic. The Caton Team loves what we do and would love to help you – please enjoy our resources below. Get to know us at through our clients words.
Got Real Estate Questions? The Caton Team is here to help.
We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!
The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.
A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.
Call| Text | Sabrina 650.799.4333 | Susan 650.796.0654 |EMAIL | WEB| BLOG
The Caton Team – Susan & Sabrina A Family of Realtors Effective. Efficient. Responsive. What can we do for you?
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