Hi friends, what do you think… worth it?
Maybe the most surprising thing about this national headline is that it DIDN’T come from the Bay Area. (Score one for the home team!)
What’s no surprise at all is buyers going to great lengths for the home they want. As we covered last week, higher mortgage rates are not likely to stem the rising tide of home prices or unearth a trove of listing supply.
In fact, higher rates will probably make our supply problems worse, as illustrated by this short but powerful piece
from Axios. With 90% of existing U.S. mortgages at a rate below the current ~5% average, many would-be sellers may choose to stay put rather than finance another home.
If you are ready to buy in this competitive market, you might think that your best weapon is a big bag of cash. Cash offers are certainly enticing to sellers, but would you be surprised to know that they are only a small portion of buyers?
The real secret weapons, for any buyer, are:
Working with a top agent in your market who has a great network and reputation.
Getting fully pre-approved with a local lender who also has a great network and reputation. (In practice, these things matter a lot!)
Being realistic. Have your goals match your budget. For help with this, refer to points 1 and 2.
Real estate remains a great hedge against inflation, and as we pointed out last week, everything is relative. There are still very desirable rates available to qualified buyers. Most importantly, time is on your side.
For 20 years, my adage has been: Buy the best home you can, in the best location as you can, as soon as you can. Then let the scarcity of land in the SF Bay Area do the rest for you over time.
Wherever you are starting from and wherever you want to go, you do have options—and they don’t include buying a home with a stranger in the basement… unless you’re looking for new friends.
Bay Area Real Estate Updates
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“Food loss and waste accounts for 170 million metric tons of carbon dioxide equivalent greenhouse gas emissions, roughly the annual CO2 emissions of 42 coal-fired power plants.” SF startup Replate
turns surplus food into meals for the homeless.