“Gentleman (and ladies), start your engines! Three-Two-One…GO!”
That may sound like the start of every Indy 500 or NASCAR race, but it also rings true for the Sacramento housing market this spring.
After a pronounced slowdown and 45% lower sales volume due to elevated interest rates, mortgage rates are starting to come down and buyers and sellers are getting active again.
In Sacramento, we’re already seeing far more buyers, more new listings, and even multiple offers and bidding wars again!
Of course, I’m making a comparison to what our hibernating housing market has looked like for the past six months or so – not trying to say it’s back to early 2022 (ludicrously hot) levels.
But it does feel like we’re at the starting line of another hot real estate market for the spring and summer!
Here are a few reasons why now may be the BEST time to get a head start on the competition and list your home for sale or go out house hunting right now:
1. Rates are Dropping
After experiencing one of the sharpest climbs for mortgage rates in history, rates for home loans have actually changed course and declined steadily over the last month or two. Rates may not be at all-time lows, but they are way below historical averages and a lot closer to the 5’s than the 7’s right now.
2. The Seasonal Uptick
Every spring and summer, the housing market sees an uptick in activity – and sometimes profoundly so. As the weather is warmer, days are longer, and the kids are out of school (or close to it), everyone is far more eager to buy or sell, and this year looks to be no different.
3. The Market has Absorbed Fed Rate Increases
Mortgage rate increases were in large part due to the Fed’s campaign to raise their benchmark rate in an effort to combat inflation. Now, inflation looks like it has just about peaked, and the Fed is ready to pause rate hikes. But the good news is that the market and mortgage landscape has already absorbed the risk and reality of higher rates early on, so we’ll probably see mortgage rates keep dropping!
4. Home Prices have Come Back Down to Earth
Let me put it this way – those who are waiting for the market to “crash” so they can pick up a home on the cheap will be waiting (and still renting) forever. But those who are looking for a 5-10% discount (or even more) on home prices compared to the peak last year are in luck this spring and summer. But be warned that continuing to wait means that you’ll probably miss out!
5. Supply vs Demand
While many are focusing on mortgage rates or home prices, the real narrative of this housing market is the lack of inventory. In fact, housing supply is at scary-low levels, especially in Sacramento and other parts of CA.
With strong and pent-up demand from homebuyers, the number of people eager to buy simply far outweighs the number of homes for sale – a recipe for a warming market.
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These are just 5 of the reasons we’re at the starting line of another hot housing market in Sacramento – and why you should call me about listing your home for top-dollar today!
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