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Our team is committed to continuing to serve all your real estate needs while incorporating safety protocol to protect all of our loved ones.

In addition, as your local real estate experts, we feel it’s our duty to give you, our valued client, all the information you need to better understand our local real estate market. Whether you’re buying or selling, we want to make sure you have the best, most pertinent information, so we’ve put together this monthly analysis breaking down specifics about the market.

As we all navigate this together, please don’t hesitate to reach out to us with any questions or concerns. We’re here to support you.

Rama Mehra, DRE #01463395

Welcome to our October newsletter, where we’ll explore residential real estate trends in the Greater Bay Area and across the nation. This month, we examine the state of the U.S. housing market now that much-needed supply has come to the market. We also explore why the worker shortage may not be as detrimental to the economy as was originally expected because of the renewed growth of entrepreneurship.  

With the increase in supply, we’ll probably see the beginning of some market cooling — but in the context of the hottest housing market in history. Housing inventory in the United States continued to rise in August, up 30% from the record low in April 2021. We’re happy to see more homes on the market because they will help satiate the high buyer demand. Although this increase in housing inventory is meaningful, there are still 74% fewer homes on the market than a year ago. The housing market will likely start to see some price corrections as it returns to a steadier state of growth. 

While we, at first, worried that the worker shortage could hurt the economy, it looks like the rise in entrepreneurship is helping to boost production and improve the economy. We often look at jobs to gauge the health of the economy: more employed workers usually mean more production and more wealth, which, in turn, means appreciating asset prices. For many months, unemployment stood at around 10 million workers; however, we have started to meaningfully close the unemployment gap, and unemployment has been reduced to 8 million workers. As risks from the delta variant wane, we’ll likely see more unemployed workers reentering the workforce. 

Despite the high rate of unemployment and record number of job openings, U.S. production is climbing rapidly. In terms of GDP, which is the broadest measure of goods and services produced, our economic recovery could reach where we would likely be if the pandemic had never happened within the next year. It cannot be overstated how rare it would be to return to pre-recession GDP, but we might just get there. A potential factor in the rise of both production and job openings is the resurgence of entrepreneurship, which is often associated with higher production. 

We remain committed to providing you with the most current market information so you feel supported and informed in your buying and selling decisions. In order to better explore how the above national trends in the economy and housing market are affecting the Greater Bay Area, this month’s newsletter will cover the following:


Key Topics and Trends in October

In the long term, employment and GDP reveal much about the economic climate and typically trend with housing prices. GDP, according to the U.S. Bureau of Economic Analysis, gained 1.6% quarter-over-quarter in 2nd Quarter (2Q) 2021, which is about 1% higher than the long-term quarterly growth rate of 0.6%. To get back to pre-pandemic GDP levels, we need to continue to outpace the long-term growth rate. The substantial infusion of cash into the economy has boosted GDP, and we are on pace to fully recover. 

The chart below illustrates the cost of the COVID recession and the projection at GDP’s current growth rate. While it depicts U.S. GDP from 2016 to 2Q 2021, it also illustrates economic patterns that occur in all recessions. GDP tends to grow at a fairly consistent rate during economic expansions. The green line exemplifies the expected GDP, had the pandemic never happened. As that green line shows, we are below where GDP was expected to be in 2Q 2021. In other words, we’re still underwater. However, unlike typical recoveries, which return to a steady-state of growth but at a lower level, the current growth rate is far higher than normal and should bring us back to our pre-pandemic trajectory by the end of the 2nd Quarter 2022.

Another Source of Economic Growth

Another large government-sponsored infusion of cash into the economy is very unlikely to happen. We may, however, have another source of economic stimulus: the massive growth in entrepreneurship over the last 16 months. From 2004 to 2019, the United States averaged 2.8 million new business applications per year. In 2020, there were 4.36 million, and in 2021, there have been 3.68 million as of August. This means that over the past 20 months, the United States has seen 8 million new business applications.

The competitive nature of our economy incentivizes new business owners to produce, creating jobs and stimulating growth. While new businesses are not as stable as more mature companies, they are often more nimble than larger companies and can produce with fewer hurdles.

The large number of new business applications may also explain why established companies have found it difficult to fill job openings. It seems that a large number of workers may now be working for themselves. Although the difficulty with hiring employees poses troubling challenges to employers, it thankfully may not indicate a struggling economy.

Home prices tend not to experience meteoric rises if the economy is in dire straits. Because home prices have increased so rapidly over the last two years, we can assume that the economy is doing well. In the last five years, housing inventory has decreased by around 940,000 (59%). Over 700,000 of those homes were sold in the last two years alone. Due to the pandemic, housing demand rose to historically high levels and mortgage rates fell to historic lows. As shown in the chart below, we’re currently hovering near all-time low mortgage rates, which will likely remain for the rest of the year. Low rates incentivize buying due to the lower monthly payment.

Even with rising inventory, the market remains competitive for buyers, but conditions are making it an exceptional time for homeowners to sell. Low inventory means sellers will receive multiple offers with fewer concessions. Because sellers are often selling one home and buying another, it’s essential that sellers work with the right agents to ensure the transition goes smoothly.


October Housing Market Updates for the Greater Bay Area

During August 2021, in the Greater Bay Area, the median single-family home price declined further from the all-time high reached in June. Year-over-year, Greater Bay Area prices increased considerably, up 18%.

The median price movements across the Greater Bay Area regions were mixed. San Francisco, Silicon Valley, and East Bay home prices declined month-over-month, while North Bay home prices increased. However, year-over-year, every county in the Bay Area is higher than last year with the exception of Monterey.

As you can see in the graphs below, median condo prices were mixed across regions and counties. Counties in the North Bay and Silicon Valley saw the largest gains.

Single-family home inventory began to climb at the start of 2021 in anticipation of the spring season, when more sellers typically come to market, but has begun to decline once again. To gain a full picture of the current market, we must view it in the context of last year. In 2020, fewer people wanted to leave the Greater Bay Area, and more people wanted to move here. This trend drove inventory down to record low levels. New listings, therefore, improve the current market conditions. In August 2021, the total inventory in the Greater Bay Area had fewer homes for sale than it did in August 2020, so the higher number of new listings is a positive development for the housing market. The sustained low inventory will likely cause prices to remain stable or appreciate throughout 2021.

Both single-family homes and condos spent less time on the market in August 2021 than they did in August of last year. As we’ll see, the pace of sales has contributed to the low Months of Supply Inventory (MSI) over the past several months.

We can use MSI as a metric to judge whether the market favors buyers or sellers. The average MSI is three months in California, which indicates a balanced market. An MSI lower than three indicates that there are more buyers than sellers on the market (meaning it’s a sellers’ market), while a higher MSI indicates there are more sellers than buyers (meaning it’s a buyers’ market). In August 2021, single-family home MSI remained below two months of supply, indicating that the market still strongly favors sellers.

Summary

In summary, the high demand and low supply in the Greater Bay Area have driven home prices up over the last year, but the huge price appreciation is slowing. Inventory will likely remain historically low this year with the sustained high demand in the area. Overall, the housing market has shown its value through the pandemic and remains one of the most valuable asset classes. The data show that housing has remained consistently strong throughout this period. 

We expect the number of new listings to slow in the coming months. However, the current market conditions can withstand a high number of new listings, and more sellers may choose to enter the market to capitalize on the high buyer demand. We expect the high demand to continue, and new houses on the market to sell quickly.

As always, we remain committed to helping our clients achieve their current and future real estate goals. Our team of experienced professionals are happy to discuss the information we’ve shared in this newsletter. We welcome you to contact us with any questions about the current market or to request an evaluation of your home or condo.

Our team is committed to continuing to serve all your real estate needs while incorporating safety protocol to protect all of our loved ones.

In addition, as your local real estate experts, we feel it’s our duty to give you, our valued client, all the information you need to better understand our local real estate market. Whether you’re buying or selling, we want to make sure you have the best, most pertinent information, so we’ve put together this monthly analysis breaking down specifics about the market.

As we all navigate this together, please don’t hesitate to reach out to us with any questions or concerns. We’re here to support you.

Rama Mehra, DRE #01463395

Welcome to our September newsletter, where we’ll discuss residential real estate trends in the East Bay and across the nation. This month, we’ll examine the state of the U.S. housing market now that more supply has come to the market and explore the impact of iBuyers and fin-tech companies’ influences on the housing market. 

From 2012 through 2019, the seasonality of the housing market was incredibly stable. For seven years, we consistently saw fewer sales in the winter months and higher sales in the spring and summer months. In 2020, however, we saw a shift. The usual seasonality gave way to super-high demand that remained consistent throughout the year, even after the initial pandemic shock from April to June 2020 faded. Then, in winter 2020 and early spring 2021, inventory decreased to historically low levels. Now we are far enough into summer to comfortably see pre-2020 seasonal trends return. 

Demand for homes has remained quite high, which has increased the use of all-cash offers that often serve as differentiators for sellers who receive multiple offers. The National Association of Realtors (NAR) reports that cash sales rose from 16% to 23% year-over-year in July. The increase in cash offers often pushes out first-time homebuyers who don’t have hundreds of thousands (or millions) of dollars on hand. At the same time, we are seeing fin-tech iBuyers (algorithmic instant cash buyers), which is still in its infancy, targeting first-time buyers as a means to stay competitive by making them all-cash buyers. This dynamic could drive demand even higher if fewer buyers are priced out of the market.

As we navigate this period of high buyer demand and low supply, we remain committed to providing you with the most current market information so you feel supported and informed in your buying and selling decisions. In this month’s newsletter, we cover the following:


Key Topics and Trends in September

Housing inventory started falling steadily in April 2020 in response to the pandemic, and the steady seasonal norms in supply vanished completely. As you can see from the chart below, we are starting to see a hint of seasonality return with the inventory increase over the summer months, albeit at a much lower level. As inventory crossed below the 600,000 level, sales began to slow; there simply weren’t enough homes to meet buyer demand, which created a hyper-competitive market for buyers. We are pleased to see inventory increase to alleviate some of the extreme demand.

The chart below, which illustrates sales over the last 12 months, reveals that sales often trend with inventory, but with a one-month lag. In other words, more sales are recorded when more inventory comes online during the previous month. For most of 2021, even though we were on pace to have a record number of home sales, the rate of sales was slowing. That deceleration, however, has reversed as more homes have come to the market.

The last year has taught us that uncertainty around the pandemic has positively correlated to home sales. People are spending more time at home, and the Federal Reserve is expected to keep mortgage rates low. As shown in the chart below, we’re currently hovering at historically low mortgage rates, which will likely remain for the rest of the year. Low-rate financing incentivizes buying, which has been one reason for the high demand over the last 18 months.

All-Cash Purchases

The housing market’s competitiveness has increased the number of all-cash purchases to the highest level we’ve seen in the last 10 years. In July 2021, NAR reported that 23% of home sales were cash purchases, which marks a 7% increase from 2020. The competitive nature of the current market has priced out many first-time homebuyers, but we could see that shift with the emergence of iBuyers, who can quickly purchase a home in cash. The speed with which buyers need to secure financing is often part of the problem for first-time buyers. iBuyers can offer the speed and financing necessary for a competitive offer. 

With such low supply and high demand for homes, we could see the market become even more competitive if fewer buyers are priced out of the market. Currently, a low percentage of sales involve iBuyers; however, if iBuyers become more common, supply could trend even lower than it already is.

While the market remains competitive for buyers, conditions are making it an exceptional time for homeowners to sell. Lower inventory means sellers will receive multiple offers with fewer concessions. Because sellers are often selling one home and buying another, it’s essential that sellers work with the right agent to ensure that the transition goes smoothly.


September Housing Market Updates for the East Bay

During July 2021, in the East Bay area, the median single-family home price remained the same month-over-month in Alameda County, but declined in Contra Costa County. Year-over-year, both Alameda and Contra Costa continue to show large price increases. Those price gains, however, seem to be decelerating, which is not surprising considering the magnitude of the price increases over the last year.

Year-over-year, single-family home prices rose significantly in Alameda and Contra Costa.

As you can see in the graph below, median condo prices increased in the East Bay; but, like single-family home prices, they remain slightly off-peak.

Single-family Homes Inventory

Single-family home inventory rose slightly over the first seven months of 2021, which is to be expected in the spring/summer season when more sellers typically come to market. In order to gain a full picture, we have to examine total inventory for the first half of 2021 in comparison to last year. In 2020, fewer people wanted to leave the East Bay, while more people wanted to move to the area. This trend drove inventory down to record low levels. New listings, therefore, improve the current market conditions. However, currently, new listings are barely outpacing demand. In July 2021, the East Bay had nearly 650 fewer homes for sale than it did in July 2020, which reflects a 13% decline. Furthermore, when we compare the current inventory to the pre-pandemic levels of July 2019, the number of homes for sale has declined by 30%. Although the seasonal trends seem to be returning, the sustained low inventory will likely cause prices to appreciate throughout 2021.

Condos Inventory

The number of condos on the market rose slightly in July 2021 as new listings outpaced sales. Condo demand remains incredibly high in the East Bay, and new listings are selling quickly.

Both single-family homes and condos spent far less time on the market in July 2021 than they did in July of last year. As we’ll see, the pace of sales has contributed to the low Months of Supply Inventory (MSI) over the past several months.

Months of Supply Inventory (MSI)

We can use MSI as a metric to judge whether the market favors buyers or sellers. The average MSI is three months in California, which indicates a balanced market. An MSI lower than three means that there are more buyers than sellers on the market (that is, it’s a sellers’ market), while a higher MSI means there are more sellers than buyers (that is, it’s a buyers’ market). In July 2021, single-family home MSI remained below one month of supply, while condo MSI rose slightly above one month of supply. Both condo and single-family home MSI indicate that the market still strongly favors sellers.


Summary

In summary, the high demand and low supply in the East Bay have driven home prices up over the last year, but the huge price appreciation is slowing. Inventory will likely remain historically low this year with the sustained high demand in the area. Overall, the housing market has shown its value through the pandemic and remains one of the most valuable asset classes. The data show that housing has remained consistently strong throughout this period. 

We expect the number of new listings will continue to increase in the remaining summer months. The current market conditions, however, can withstand a high number of new listings, and more sellers may also enter the market to capitalize on the high buyer demand. As we navigate the summer season, we expect the high demand to continue, and new houses on the market to sell quickly.

As always, we remain committed to helping our clients achieve their current and future real estate goals. Our team of experienced professionals are happy to discuss the information we’ve shared in this newsletter. We welcome you to contact us with any questions about the current market or to request an evaluation of your home or condo.

Call us at 925-415-0825 today for any questions that you might have.

Just four months ago, National Association of Home Builders (NAHB) released an article that indicated how 60% of the active home buyers are prefer to buy a newly-built home instead of an existing one. Buyers have stated the top reasons they would opt for a newly built home like having the features that they would have their home, the occurring pandemic, and choosing the exact location of their home.

However, in the recent Housing Trends Report of NAHB for the 2nd quarter of 2021, there is already a change in preference.

Currently, home buyers now prefer to buy existing homes and the percentage of those who would like to buy newly-built homes went down as indicated in the infographic below.

9% of those who desired to buy a newly-built home have changed their minds and have now preferred existing homes while others prefer either newly-built or existing homes.

This change in preference is caused by several factors. As more citizens get vaccinated, the fear of being exposed to COVID-19 has settled down. Buyers also saw that the process may move a bit faster when purchasing an existing home since there is a great demand and little supply of builders and materials. Also when buying an existing home, the unexpected costs are very minimal and you even have the hand as a buyer to negotiate the final price.

Are you among those who changed their minds? Or are you those who would still prefer to buy a newly-built home than an existing one? Let us know in the comment below and if you need help in buying, just call 925-415-0835. We know how to make your home buying experience a great one!  

What makes Danville awesome?

Danville is a charming town that has a lot to offer. Their motto even says that. “Small town atmosphere, outstanding quality of life.” From the location, to the people, the what one can do in this town, you will always find something that suits your taste.

Danville weather

from weatherspark.com

If you ask anybody within the town, one of their top reasons why they choose to live here is the weather. According to BestPlaces, the comfort index of Danville when it comes to its climate is 8.5/10. With an average of 260 days of sunny days (205 days is the national average), only 19.3 inches of rain as compared to the national average of 38.1in and 0 inches of snowfall, no wonder the people are loving it here!

Source: bestplaces.net

How safe is Danville?

Source: safewise.com

Danville is pretty safe. It’s actually the safest city in California!

It’s violent crime rate in 2021 is 0.5%, 0.4% for both 2020 and 2019. The national average violent crime rate is currently 41%. For property crime rate in Danville, it is 6.6% this 2021, 7.2% in 2020, and 7.8% in 2019, decreasing each year! The national property crime rate is currently at 42%.

It’s safe to say that you’ll definitely have peace of mind while you are in town.

Activities You Can Do in Danville:

When it comes to the things that you can do within the town, the choices are endless!

If you’re a dog lover, you will love Canine Corral.

This beautiful 1.5-acre land is the perfect place for you and your pet to mingle with other dogs and pet lovers in town. Dogs can run free without their leash provided that they are not aggressive, not in season, and not younger than 4 months. You can also bring your children who are aged 9 years and above.

SPORTS:  There are a lot of fields and gyms within the town to keep your body moving. Due to the COVID-19 situation, gyms are still currently closed until further notice.  However, there are also several athletic programs for adults, teens, and kids that would definitely ignite your competitive spirit.  Adults can choose between basketball or softball are a regular sport, or if you want to try something new and unique, try Bocce ball! There is also a regular basketball program for the youth but is currently on hold until further notice. The swimming pool is not currently open and you can apply for aquatics lessons here! If you’re into golf, Danville has lots of country clubs to choose from!

LEISURE: Want to walk around parks and meet new people? Danville has 6! Each park offers unique activities for fun and leisure.

These parks offer lots of activities like horseback riding, plenty of wonderful walking trails, picnic areas, play areas, tennis, volleyball, and even baseball. You’ll definitely not get bored with this place.

Not convinced enough? Here are more reasons to love Danville parks!

ARTS: Are you an artist? Your love for art will never be quenched with the multiple galleries and activities for people like you.

We also have a Village Theater where artists perform every once in a while.

For more lists of fun activities, go here.

Danville Community

No question about it, Danville is bursting with life! The lovely town does not only prioritize fun and leisure, but also the people’s health. Visit the farmer’s market to discover the Taste of Danville to find fresh and delicious produce for any season.  

Excited to visit and live in Danville. Call us today at (925) 415-0835 to ask for our available listings in this wonderful community!

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Pleasanton is undeniably one of the most beautiful communities in the Bay Area. In fact, it was ranked 4th in the Top 10 Places to Visit in the US last 2018 in an article by Livability. And we couldn’t agree more! The location (45 miles east of San Francisco), the great weather throughout the whole year, and the many activities that one can do.

Pleasanton was also declared last 2013 and 2016 as the 3rd wealthiest city in earnings in the country by NerdWallet. According to Payscale, the cost of living here is 91% higher than the national average.

But what does Pleasanton really offer? Let’s look at each one.

The Pleasanton Weather:

On average, there are 264 sunny days in Pleasanton in a year! You can also expect 19 inches of rain and 0 inches of snow per year! The annual BestPlaces Comfort Index for Pleasanton is 8.6 (10=best), which means it is more comfortable than most places in California.

Activities You Can do in Pleasanton:

There are a LOT of things you can do in Pleasanton. Being true to its name, whether you’re a resident or just passing by, you’ll find many pleasant things to do in this town.

Are you an animal lover? Visit the local animal shelter at East County Animal Shelter to volunteer and consider adopting. Rest assured, the Pleasanton community is a pet-friendly one. 

If you’re a bibliophile, check out the local library which offers a range of activities aside from reading books. There are crafting events and even game nights that are suitable for all ages!

Artists also have a special place in Pleasanton. Visit the Firehouse Arts Center not only to view the awesome art gallery, but to also enlist to several programs on improv, acting classes and even about writing.

The Pleasanton Community:

A lovely local community wouldnt be complete without homegrown and organic food. Do not forget to frequent the farmer’s market where there are various choices of produce to choose from!

If you’re a shopaholic or would love to have a weekend just shop hopping, there’s a place for you. Just make sure to follow certain protocols before visiting the area.

When all else has failed to pique your interest, the Alameda County Fairgrounds will give you something to look forward to week after week after week. We are sure there’s definitely an event that will grab your attention!

Do not worry about how to travel from home to work because public transportation in Pleasanton is highly accessible. You can take the Bay Area Rapid Transit (BART) for a direct ride to San Francisco. Another train choice would be Altamont Corridor Express. If you would like to take the bus, Wheels is the service available for you, but you’d prefer carpools or vanpools, 511 Regional Rideshare is the service that you can use. For more details, check this out.

Pleasanton is definitely an ideal neighborhood for anyone who loves the balance of the quiet suburbs and the social events every now and then.

Are you looking for a home in Pleasanton? You’re in the right place! Checkout the available listings of our tema within the area or call us at 925-415-0835 today!

No doubt about it, 2020 was a difficult time for everyone.

Yet in this unprecedented time, Asante Realty is grateful for the trust that you have given us in buying your dream homes and selling your old homes to move to your next chapter in life.

A lot of businesses, including ours were greatly affected, temporarily freezing all business transactions that require face-to-face meetings. The team had to adapt to the changing times, rolled with the punches and became stronger than ever before. Despite the Open Houses ceasing, we’ve continue to strive for the best of our clients.

 That is why after a long 18-month shutdown due to COVID-19, Rama and Sunil decided that we need to have a summer BBQ party for our team, family, friends and our vendors.

the OG Rama Mehra Team

It was our way of appreciating all the hard work every team member puts into the business and taking a breather to enjoy good food!

Rama and Sunil welcomed the whole team, their trusted vendors and clients to their home. The whole team is fully vaccinated, safe and healthy, as well as guests, and proper protocols were practiced.

Nothing can really replace the personal human connection. It was a night like no other especially now that things are slowly going back to normal. There were smiles on everyone’s faces, as we finally get to laugh out loud with one another, share our survival stories, and hope for a better future not just for the business but for the whole world.

Truly, the best is just yet to come. Cheers to a hopeful 2021!

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If you’ve been keeping watch of our posts on the market update per area, you might be confused with the different paths each area is doing. 

In some places, more listings are sold over a shorter period of time, while in another less listings are sold with longer average days on the market. 

Even though no one can exactly know what can happen in the next half of 2021, we can look at the numbers. After all, numbers do not lie. 

Let’s also look at what experts have to say regarding the housing economy. 

Mortgage will increase, but comparatively low

One thing is sure, mortgage rates will not decrease. There’s a steady rise of mortgage rates over the past months as the economy start to recover from the 2021 crisis. According to Freddie Mac in their latest quarterly forecast, an average of 3.4% mortgage rate will be expected by the end of 2021 and 3.8% by the end of 2022. 

Slow home price appreciation

According to all industry leaders, home price will continue to appreciate towards the end of 2021. 

Senior Markets Economist at J.P. Morgan Joe Seydl said that the projected rise of the home prices should be taken as signal for buyers to grab the opportunity as soon as possible instead of waiting with the expectation that prices will decrease. 

Inventory will be a less challenging 

The good news is that more inventory is coming in the market, giving more choices for homebuyers and decrease the fast pace. 

Here are some statements from experts in the field: 

We have seen more new listings this year compared with 2020 in 11 of the last 13 weeks. The influx of new sellers over the last couple of months has been especially helpful in slowing price gains.” (George Ratiu, Senior Economist at realtor.com)

“As an indicator of the economic impact of housing, there are now 652,000 single-family homes under construction. This is 28% higher than a year ago.” (Robert Dietz, Chief Economist at the National Association of Home Builders)

Summary

With the expected rise of mortgage rates, price appreciation and the number of expected inventory in the next half of the year, your chances in the housing market look promising. 

The only thing left to do is work with the team that is after your own interests. The Rama Mehra Team is here to make great offers, negotiate for your cause and help you find the best deal for you and your loved ones. Contact us today (925) 415-0835!

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