Is it a great time to buy is the most common question I get asked. While working on my 2019 goals I sat to wonder is it a good time to buy or sell? Lets have a look at what California real estate, most important to me the Sacramento/Roseville real estate market is forecasting.
First off interest rates are rising faster than the climate is changing. Surely this will cause a lot of investors who have gained massive amounts of equity to look to capitalize on selling before rate hikes cause a plateau in prices.
A rise in rates should not affect the Sacramento market as dramatic as the 2008 market collapse did. What the rising rates combined with other market forces will certainly achieve is a drop in the expected rise of property values.
According to the California Association of Realtors, the 2019 California housing market forecast is expecting a price drop due to the raise in rates cutting into home affordability. With already high housing prices, raising the cost to borrow money will price many buyers out of the market. In 2018 the median home price rose by 7% however, 2019 is expected to only bring a 3.1% increase in median prices.
Without the aggressive rise in median prices short term investors may look to put their money to use in other avenues with greater returns.
The California Association of Realtors also points out in their 2019 projections the continued outmigration of the state of California. High cost of living between local taxes and property values, residents of California are either moving to another county within the state or simply leaving it altogether. This is a result of the weak California non-farm job market and the non-farm job growth expected to be an alarming 1.4% GDP, lower than the original expected 2%.
What does this all mean for you? Should you buy and or sell? Well if you currently own a home on a fixed rate for 15 years or more and are happy with this home than no need to worry about selling. However, if your are considering selling and or buying a new home in the next 12 months than you should buy or sell your real estate.
As a seller a solid and well executed marketing strategy will be mandatory to selling your home. I will be posting a sample marketing strategy, but every marketing plan needs to be unique for an individual property. A one size fits all marketing strategy is where listings go to expire on the MLS. As a buyer your realtor will need to do some selling of your offer. If executed properly your offer will be hard to turn down. Does this mean throwing more money at an offer? No, not even a need to send over market offers if your entire offer is sound. As a buyer bring value to the transaction beyond your wallet. One of the many ways to do this is send an offer with sellers protection American Home Shield warranty. This will protect the seller from incidental cost that may hold of escrow from closing.
Rates may rise and fall, values of homes may slow to increase, but if your home is a long term investment for your forever home it is always a great time to buy.