Thursday, December 22, 2011
Is now time to buy? Redfin says yes!
Redfin's monthly market report for December says that while the housing market is still dragging along, things are looking increasingly good for buyers, and in particular first time home buyers. The sad news is that, inflation adjusted, all gains in home values since 2000 are basically wiped out. But, that depression on the market is dragging it extra low, meaning few people are buying when actually, now is really good time. Here are some of the facts Redfin points out:
Things have pretty well stabilized. In fact, while economists predicted the second half of 2011 would show another 6 or 7% decline, around here it was more like a 0.6% decline for the year. Not great, but not so bad.
For those who are still renters, the rental market is getting pretty cruel. Nationally its at its tightest since 2006 and rents have gone up around 3%. In the Bay Area its at its tightest in a decade. In both Oakland and the Bay Area, rents have gone up nearly 10% this year.
In San Francisco proper the vacancy rate is at a historically low 3.2 percent, and demand has pushed rents up 9 percent in the past year to an average of $2,568 per month (San Francisco Business Times, November, 2011). In Oakland: “Landlords throughout Oakland have seen vacancies in their buildings dwindle to less than 5 percent and have in turn raised rents 5 to 10 percent." (San Francisco Business Times, Friday, November 25, 2011)And finally, interest rates are now below 4%, which is historically incredibly low.
So for folks looking to trade up from renting to owning, there's a lot of wind at your back. Add that to some really nice, new condo units available out there for incredibly low prices, and you could score an absolute steal right now.
The full report is available at http://blog.redfin.com/blog/2011/12/the_market_spends_another_day_in_its_bathrobe_but_feeling_better.html