2006-09-21 17:56:13 · 5 answers · asked by Richard Y 2 in Business & Finance ➔ Renting & Real Estate
Housing market cycles usually take a few years to develope and to resolve. This housing bubble took over 5 years to form. It is unlikely that correction will be completed in 1 year.
We are at the beginning of the correction.
If you would like to sell, then do it this year. It might be better to give some discount so you unload the house quickly and can use the gain of the home to make money elsewhere quickly. At the same time, you will save money by not paying mortgage for the next 5 months.
For example, if mortgage is $2500/mo. and you have $300,000 gain sitting in the house, by selling it now rather than 5 months later will save you $12500. It will also earn you as much as $7000 from interests (Assuming CD are paying 5.5% or higher).
Total financial benefit for selling early would be $20,000. I would give buyer some discount just because of that.
Finally, keeping a house in selling condition is a lot of work. If your realtor does staging, it costs extra to rent furnitures. If you are living in the unit, it takes extra effort to keep it clean. So, sell it fast!
---------------------------------------------
Southern California housing market is already negative in year over year medium price. So, we don't need address it separately.
Let's talk about the San Francisco Bay area. One of the most hyped market.
SF Bay area housing market is going through the early stage of correction. It is likely to take a couple years to resolve.
During 1990's there were times when housing market in SF Bay area went negative. It started in 1990 and sellers, who entered the market at that time, had to wait until 1997 to unload their property with a gain.
Today, in 2006, we are in the early stage of another housing correction . Please see this page:
http://www.viewfromsiliconvalley.com/id157.html
The "Year over Year" medium price for San Mateo is -2.0%. If we consider inflation, then that is -5.5%. Because inflation tops 3.5%. For Santa Clara county, the gain is only 1.7%. That is lowest ever in the past 5 years. If we count inflation in our valuation, then it is -1.8%.
In addition, sales volumn drops dramatically, which means high end properties garnished most of sales, keeping the medium price high. While less appealing properties stays on the market longer and longer.
Inventories build up as sales down. Inventory for single family grew to 2222 units in July from 1500 in January this year. Condo inventory grew from 658 to 841 units by July from January. Why is inventory growing while summer is suppose to be a good selling season.
2006-09-21 22:51:21 · answer #1 · answered by Price is what you pay for value. 3 · 0⤊ 0⤋
I think they will. It is an election year and that always seems to help. Plus seems like the interest rates keeping dropping. Just a little at a time but they are going down.
Dont use Zillow.com the prices do not reflect the real worth. They are not updated enough and seem to be representative of last years prices.
2006-09-21 18:11:37 · answer #2 · answered by GEE-GEE 5 · 1⤊ 1⤋
This site will give you the price your house is worth. Just enter your info. Pretty cool site gives you a map and what other houses are going for in your area too.
2006-09-21 18:10:10 · answer #3 · answered by cosmo199701 2 · 0⤊ 0⤋
Probably not, unless the interest rates drop again.
2006-09-21 17:58:33 · answer #4 · answered by J Z 4 · 0⤊ 0⤋
Who knows? No one can predict the future. We can only look at past trends.
2006-09-22 13:02:00 · answer #5 · answered by Karen R 3 · 0⤊ 1⤋