Demand & Supply

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As higher mortgage rates become the new normal, more buyers are entering the market. But the same high rates are causing many potential sellers to stay in their homes with lower long-term fixed payments. When will supply catch up with demand?

CHIC (Pearl)

I get the feeling we’re almost there now. New listings, offers, and sales prices may be down year over year, but they’re all on the uptick so far in 2023. Open houses and broker tours are packed, and homes are selling quickly with multiple offers. Everything seems to be moving in a positive direction.

GEEK (Kevin)

Feelings are fine, but I need more data before I’m willing to say the market is on its way back. We could also be in the middle of a long-term malaise that will only be resolved when things explode or fall apart completely. Neither would be surprising at this point. But here’s hoping for an explosion.

March 2023 Market Report

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The numbers are in from March, and sales of single family homes remained slow in Santa Clara and San Mateo Counties, down as much as 40% year over year, with median prices 13% below what they were a year ago. But properties are spending more time on the market as buyers are still wary of high mortgage interest rates.

Interest rates trending down

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In a sign that should bring a smile to the faces of homebuyers, daily and weekly average mortgage interest rates are on a downward trajectory in the wake of recent bank collapses. This could help to ease inflation and get the volatile market back on track in time for a summer warming.

While these data sets come from multiple sources with different methodologies to calculate their figures, the trends are extremely similar. That said, it can be difficult to predict short-term rate changes, so it’s important to keep the big picture in mind. For example, despite a spike over the past year, rates remain well below where they were in the 1990s.