Fall is in full swing! As temperatures drop and the rain fall begins, we shall be seeing changes in the real estate housing market. This year, you may have noticed a pumpkin shortage and price inflation due to the California drought and lack of labor. The haunting news regarding this seasonal item may have scared you, but that may not be the only spine-chilling fact. Here’s a look at September’s numbers.
September marks the end of the California eviction moratorium. In a way, it puts us on a new page of the COVID-19 pandemic. After a year and a half of pandemic, the housing market changed a lot. Recall that in fall of 2020, Napa, Marin and Contra Costa county were leading the pack in home value growth. Back in those days, buyers were in the frenzy of finding a larger home with a large outdoor space, driving up demand in the more suburb counties. A year later, we can see that things start to balance out a bit. Alameda county, which only recorded modest gain in 2020, is now leading with 23.8% of year over year growth compared to 2020, putting it closer to San Francisco value than ever.
Looking forward, I expect home prices will be sluggish in the rest of the 2021, due to two factors. 1) We had a bumpy stock market in September, which would shake buyer and consumer confidence. Although stock finally climbed back up at the end of October and even broke new highs, there are enough concerns from the public about the economy that it will reflect on the housing market. 2) The inflation pressure is building up and the Fed will start shrinking its balance sheet earlier than expected, causing the mortgage interest to go higher. Homes will become less affordable as mortgage payments go up.
