Retreat of the California Seller’s Market

April 25, 2023 Broker

Real estate agents throughout the California regions are reporting a rapid shift in the market. Six months ago in quarter 2 2022, 95% of agents who were surveyed characterized their market as a seller’s market. In Q3, that number had declined to 51%, and in Q4 it fell to just 30% of agents.

Home Buyers in this wonderful state of California, are beginning to see more favorable conditions when it comes to pricing and competition for homes as the market continues to rebalance. This is in sharp contrast to the hot real estate and lending markets that we witnessed from 2020 to mid-2022, when agents consistently reported a buyer’s market at a rate of only 1%-2%.

An example of this market shift can be found in a study where 64% of agents say that most homes in their market are not getting multiple offers. This is reminiscent of the trend that began in Q3 2022.

Nearly 95% of all agents surveyed reported that the average days on the market for listings in their area is increasing. But because housing is retaining much of the staggering equity gains of the past couple of years, and the increasing interest rates affecting affordability, the situation isn’t a buyer’s paradise yet.

If you are planning to purchase or refinance your home but can’t qualify for a conventional loan, consider a private mortgage from Sun Pacific Mortgage (707-523-2099 – www.sunpacificmortgage.com). We have helped thousands of buyers just like you for the past 35 years with our family-owned company.

A Look at Northern California Real Estate in April

April 18, 2023 Loan Originator

If we look specifically at the Sonoma County Real Estate market from late 2022 through mid-April 2023, we can see that buyer demand seems to have rebounded from the historic mid-winter doldrums. The signs that things are looking up include the percentage of listings going into contract, overbidding picking up, and the days on the market decreasing.

The median home price in the 10 Northern California counties during the past 4 months through mid-March 2023 are indicative of a robust real estate market:

San Mateo County: $1,550,000
San Francisco County: $1,400,000
Santa Clara County: $1,393,000
Marin County: $1,248,500
Santa Cruz County: $1,150,000
Alameda County: $968,000
Sonoma County: $750,000
Monterey County: $702,500
Contra Costa County: $670,000
Solano County: $538,000

We have entered the seasonal period where inventory begins to pick up and some counties are even seeing selling prices exceeding asking prices.

If you need help with a mortgage loan because you need a fast closing or your credit is not up to par, give Sun Pacific Mortgage a call to see if you qualify for a private mortgage from us. You can reach us at 707-523—2099 or find us at www.sunpacmortgage.com.

A Tale of 2 Housing Markets in California: Why Some Homes Still Cause Heated Bidding Wars While Others Sit Unsold

March 28, 2023 Loan Originator

Came across this very interesting & informative article by Clare Trapasso earlier this month, and feel impelled to share:

Homebuyers who are closely watching the correction in the real estate market might believe now is a good time to pounce. After all, homes are sitting on the market for longer, those maddening bidding wars have dried up, and wild offers over the asking price are things of the past, right?

Well, not exactly. It all depends on what they’re hoping to purchase.

Those searching for a home are seeing plenty of fixer-uppers, homes lacking curb appeal, and those in less desirable areas sitting on the market for longer and undergoing price reductions. But well-appointed, well-situated turnkey homes are still selling fast, often receiving multiple offers, and even selling over the asking price. It’s as if the housing slowdown hasn’t affected these properties much at all.

“If it’s a good home in the resale market, it’s selling quickly,” says Ali Wolf, chief economist of the building consultancy Zonda. “The buyer who is buying today is not the same buyer buying 12 months ago. If [they’re] paying this much, it needs to be a nice home.”

Competition for turnkey homes in good school districts remains fierce.

“If the house is perfect, the odds of someone else wanting it are high, too,” says Geena Peoples, an Austin, TX–based real estate agent with The Juice Group at Compass.

Home prices are still much higher than they were before the COVID-19 pandemic. And while mortgage rates have fallen a bit of late, they’re still substantially higher than they were at this time last year, jumping to just over 6% for 30-year fixed-rate loans, according to Freddie Mac. So, buyers don’t have much room in their budget for costly repairs.

“In a market where costs are still high and buyers can be a little choosier, it makes sense they’re going to really zero in on the homes that are the most appealing,” says Realtor.com® Chief Economist Danielle Hale.

During the pandemic, just about everything was selling for more money than ever before because homebuyers didn’t have much to choose from. Even fixer-uppers in the right markets were hot commodities. Buyers and investors could snap up these properties and still be able to afford the work they needed.

“Back in 2021, you could list just about anything and there would be a line out the door,” says Peoples. She used to see dated homes with cracks in the foundation and the walls on the market, and buyers would still pounce on them. But those days seem to have ended, at least for now.

There you go, some information to consider when advising your Home Buyers and Borrowers on what’s the best move for them to get a new home loan to buy or to refinance, throughout California!

What’s Happening in the North Bay Real Estate Market?

March 21, 2023 Loan Originator

I always find that knowing what’s happening with the real estate market is beneficial towards assisting Homebuyers and Borrowers make better decisions. Keeping abreast of this information is also helpful when working with licensed peers, to better work together to help clients.

The following report includes both single-family and condominiums in some popular counties:

Marin County:

Inventory was 46% (211 homes) below January 2022, but only 4% below December 2022.
New sales were 21% (99 homes) below January 2022 and were 29% above December 2022.

Napa County:

Inventory was 43% (78 homes) below January 2022 but 3% above December 2022
New sales were 9% (43 homes) below January 2022 and were 54% above December 2022

Mendocino County:

Inventory was 8% (210 homes) below January 2022 and 13% below December 2022
New sales of 36 homes in January 2023 were slightly above the sale of 35 homes in January 2022 and slightly below the December 2022 level of 37 homes.

Lake County:

Inventory was 13% above the inventory in January 2022 and 2% below the inventory last month of 357 homes.
Closed sales in January were 39% below January 2022 and 32% below December 2022

Solano County:

Inventory was at 436.
223 homes sold and closed in January 2023 while historically 500 sales occur per month.

What we can conclude from this report is that while sales and inventory are well below the levels of January 2022, they definitely look better for most counties than December looked.

Real estate experts expect the Spring will bring better reporting numbers with more inventory and more buyers looking for a less competitive market than they experienced during the last couple of years.

I look forward to a busy 2023 in the real estate and lending markets. Hope you do too!

Visit our website at www.sunpacificmortgage.com for more information about what we do and what we offer.

A Look At The Real Estate Market in California

March 14, 2023 Loan Originator

California’s housing market continued to improve in January as buyers gained more confidence in purchasing a home and the affordability outlook improved slightly. Monthly sales may have been nominal for the past few months, but the market appears to be heading in the right direction. Home prices are expected to remain soft and less expensive homes will be easier to sell, especially in the San Francisco Bay Area according to the California Association of Realtors’ chief economist.

California home sales inched up in January for the second straight month as prices moderated somewhat. Sales of single-family homes were up 0.4% from December. The median time to sell a home in California was 33 days in January 2023, compared to the 12 days in 2022.

January’s statewide median home price was $751,330, down just 3% from December 2022. Given the huge appreciation homes acquired over the past couple of years, this decline could be viewed as negligible.

All in all, real estate through California remains a strong investment – for personal home buying, 2nd home buying, purchasing rental properties or even investing in Deeds of Trusts. Anyone needing fast financing or having difficult qualifying for home loans elsewhere, should check out Private Money or Hard Money loans. These fast and alternative mortgages from Sun Pacific Mortgage have assisted over 10,000 Borrowers over the past 35 years.

Give us a call at 707-523-2099 to see how we might be able to assist you personally or assist a client or visit our website at www.sunpacificmortgage.com. We are also open for seasoned Private Lenders and individuals interested in investing in Deeds of Trust, earning higher returns.

A Quick View of 2023 Markets for: San Francisco & the Peninsula Real Estate

March 7, 2023 Broker

Received another informative article from Val Krysov, long-time Real Estate Broker about the Bay Area’s real estate market. Summarizing his and other recent articles about San Francisco real estate, we can see declines in sales and values have been predicted. However, based on the latest statistics for sales of single-family and condo residences at the start of the year, there’s no obvious signs of deceleration. Val’s data supports the market still being strong:

San Francisco Single-Family residences:

Ave. sales price: $1,848,077
Days on market: 46
For sale at end of month: 218
Sold: 93

Menlo Park Single-Family residences:

Ave. sales price: $3,337,900
Days on market: 25
Sales price=asking price

Belmont Single-Family residences:

Ave. sales price: $1,870,000
Days on market: 41
Sales price=4% above asking

San Carlos Single-Family residences:

Ave. sales price: $2,242,000
Days on market: 39
Sales price=2% above asking

San Mateo Single-Family residences:

Ave. sales price: $1,743,769
Days on market: 30
Sales price=2% above asking

Burlingame Single-Family residences:

Ave. sales price: $2,296,875
Days on market: 34
Sales price= 2% above asking

This report does not bear out some of the more depressing forecasts touted by the predictions. Perhaps, because of the lack of inventory in these cities we are not seeing prices drop as precipitously as they might and Investors and homebuyers still see these areas as strong real estate investments.

If you have a homebuyer or borrower looking to buy or refinance in the San Francisco Bay Area, and they are in need a private mortgage because they do not qualify for conventional or traditional financing, or just need some FAST mortgage help, give us a call at 707-523-2099 or find us through our website at Sunpacificmortgage.com. We have helped thousands of borrowers in California for over three decades and we work with Brokers and Agents.

How’s The Real Estate Market for Alameda and San Joaquin Counties Looking?

February 28, 2023 Loan Originator

While the nation is concerned about the effects of a possible recession, it is good to remember that while history doesn’t always repeat itself, we can learn from the past. According to historical data, in most recessions, home values have appreciated and mortgage rates have declined. By most accounts, it is highly unlikely that we will see any kind of protracted decline in new residential structures that could set off a recession.

Looking at the single-family residential market in two random counties in California, i.e. Alameda and San Joaquin, it becomes apparent that California may be spared the worst of the decline:

Alameda County:

Median List Price: $900,000

Average days on Market: 94

Inventory: 587

Price increase: 3%

San Joaquin County:

Median List Price: $555,000

Average days on market: 89

Price increase: 3%

Other than the fact that homes are sitting on the market longer than last year, it does not appear that prices have plunged to extents they have in other places in the nation.

According to Taylor Marr, Deputy Chief Economist at Redfin,

“The housing market has begun to recover after hitting a low point in the second week of November. We’re not out of the woods yet, but homebuyers are coming off the sidelines. The number of people contacting Redfin agents to start the homebuying process has improved 13%.”

If you are ready to start investing again – in rentals or your own home – and cannot qualify for a conventional loan or are looking for a fast close, give Sun Pacific Mortgage a call at 707-523-2099 or visit our website at www.sunpacificmortgage.com.

What Are Experts Saying About the California Housing Market?

February 21, 2023 Broker

Here are some of the latest quotes by the economic experts regarding the housing market in the U.S.:

“There are growing signs that housing market activity may be closer to a trough. The decline in mortgage rates over the past couple of months has led to a small improvement in affordability and a rise in home buyer sentiment, albeit from a record low. Corroborating this, mortgage applications for home purchase have ticked higher in the past couple of months, which should feed through to higher sales.” Sam Hall, property economist at Capital Economics.

Let’s be clear: Even if home sales have indeed bottomed out, it doesn’t guarantee that home sales will have a swift recovery. This is what we can expect when home prices soared 41% in just over two years and mortgage rates doubled in a 12-month span.

Just because U.S. home sales might be nearing a bottom doesn’t mean we should be looking at the bottom for U.S. home prices.

“Affordability will remain stretched. We think house prices will need to fall another 6-7% to bring affordability back to a level that will support more normal levels of demand.” Capital Economics researchers.

The reason the housing market activity could be on the mend is because affordability has “depressurized” a bit lately. Over the past two months, the mortgage rates decreased, and incomes increased, helping to “depressurize” the market. Recently, Mark Zandi told Fortune:

“Housing demand is close to a trough; housing supply has yet to hit bottom; and house prices have a way to go before reaching their nadir. The reason: housing affordability remains out of balance.

In short, real estate remains a solid investment for anyone looking to grow their wealth for retirement. Whether you are a buyer or an investor, you can never go wrong with Sun Pacific Mortgage’s private loans to help you along the way. Visit our website at www.sunpacificmortgage.com or give Sun Pacific Mortgage a call at 707-523-2099 to discuss our available privately funded loans or how you can become part of our Team of Investors.

Predicted Trends in California Real Estate for 2023

February 14, 2023 Loan Originator

Every year starts with predicted trends based on the previous year’s conditions and the overall financial, geo-political and social situation in any given area. Here are some of the ones predicted for California:

Buyers will be less likely to invest. For Sellers this means a lower demand and more effort to sell their properties, while Buyers have more homes to choose from if they decide to make the move.
Buyers are leaving cities for the suburbs. This trend from 2021-2022 will probably continue in 2023. Big cities such as San Francisco and Los Angeles are experiencing a decrease in sales, due to high prices and the fact that people are looking for a less busy place to live while they continue to work remotely.
High mortgage rates continue to hurt both Sellers and Buyers. More Buyers are considering short-term private mortgages as a means of getting into a home quickly and with fewer restrictions.
Should you buy or sell a new home now? The experts predict a continued Seller’s market in California. Low inventory ensures Sellers are at an advantage, and rising prices are only encouraging Sellers to put their properties up for sale.

If you do decide to sell this year, the experts advise not to wait until the last minute to find a new home. Many Sellers today find their new home first and use the equity in their existing home to obtain a “bridge loan”. This is allowing them to secure a home before selling their existing one. If this is a possible solution to your buying dilemma, give Sun Pacific Mortgage a call at 707-523-2099 to discuss a private bridge loan or visit our website www.SunPacificMortgage.com to find out more information about the Private Money mortgages we offer.

Granny Flats in California are Gaining in Popularity

January 10, 2023 Loan Originator

In order to put a dent in California’s housing shortage, state and local lawmakers have eliminated a substantial amount of red tape to allow homeowners to build second residences on a property.

We are seeing reduced building impact fees, reduced parking and setback requirements and the waiver for owner-occupancy on site. All these changes have been made to encourage ADU construction throughout the state to combat the state’s ever growing housing shortage.

Because we have had home construction lagging population growth, California’s Statewide Housing Plan calls for an acceleration of new home construction over the next eight years with a target of 2.5 million homes. This target is broken down as follows:

643,352 very-low-income homes
384,910 low-income homes
420,814 moderate-income homes
1,051,177 above-moderate-income homes

Some roadblocks that have been experienced include restrictions on drilling a new well (Sonoma County) and making your new build all electric (Marin County). There are still issues with material shortages that make for slow-going in the building process.

Most builders of an ADU would definitely do it again in spite of all the difficulties they experienced in the build. Roadblocks encountered differ from county to county. For instance, Sonoma County allows you to go right to the county website and choose preapproved plans. Their permitting process is more streamlined because they want more rentals. In Napa County supervisors launched a $5 million forgivable loan program for residents who build ADUs and rent them below market value. There are other programs in the North Bay Counties that exist to encourage the ADU build out.

If you are considering an ADU for your property and have sufficient equity in your home, you might want to investigate a refinance with extra cash out or even a 2nd mortgage with Sun Pacific Mortgage. We are a private lender with 35+ years of experience in California real estate lending. We offer fast, flexible and expert alternative financing. Give us a call at 707-523-2099 or visit our website at www.sunpacificmortgage.com.

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