Talk'n How's the Market?

[00:00:06] Speaker A: The Michael Hatfield REMAX team presents Real Estate and More. [00:00:11] Speaker B: Bay Area real estate is different than in all of America and why? What's up with home buyers? What's on sellers minds? How is the market and much, much more. [00:00:22] Speaker A: Now here's your host, Michael Hatfield. [00:00:25] Speaker B: Welcome to the Real Estate and More show and I'm so glad you've tuned in today. We have an incredible episode lined up talking about real estate. We're diving into the talk and how's the market covering the latest in real estate trends and highlights from August, September and October. Then we're going to dive into what the real estate associations, the realtor associations are saying as projections in 2000. Our correction for 2025. We're going to talk about what this means to us as a home buyer or a home seller at the end there. And we hope that as we get closer to the new year, the interesting facts that come out will not stymie anybody too much. To help me with all of this, I have the amazing Nancy Hatfield, a fantastic realtor with me here. Welcome, Nance. [00:01:19] Speaker C: Thank you, Michael. [00:01:21] Speaker B: Wow. There's so much buzz going on about the real estate market and so much happening. To help make sense of it all, we're going to go through different items and talk about the last reportings. And I know the statistics are so boring and I know it's no fun, a lot of cases, but we still have to go through those outlines or actual conclusions of statistics in order to get what our viewpoint is. How's the market? So let's go through those. And whenever you're ready to start, I'm waiting. [00:01:53] Speaker C: We have much to talk about the real estate with real estate right now. Let's first discuss August and September happenings in the housing market and what things look like as we run up to the new year 2025. [00:02:07] Speaker B: Wow. Yeah. [00:02:09] Speaker C: So what are market reports from the national association of Realtors indicating for August and September of this year? [00:02:17] Speaker B: Well, existing home sales as we know, because we spend a lot of time with our boots on the ground, we're seeing that exist home sales, they slid a little bit in September and also in August they were really slow. They were down 3.5% from a year ago September. So nationally, existing home sales have been running around 3.84 million home units sold per year. And that's where it's been stuck for a couple years now. It's been stuck at, you know, just under 4 million homes. And that's what we're seeing in September. It's, it's down A little bit from August, it was down 1%. September was down 1% from August, but 3.5% from a year ago. [00:03:06] Speaker C: Well, that helps to get those data points. At the end of September of this year, 1.39 million homes were for sale and that's up 1.5% from August and up 23% from a year ago. So more homes have come on the market as compared to last year. [00:03:28] Speaker B: So home inventory. So some folks are saying, okay, it's time to sell now. So they've put their homes on the market. So we've had an increase in inventory or more loaves of bread on the shelves for about the same number or a little bit less of buyers. The market is not crashing, let me tell you. It's not crashing. It simply manifests as more days on the market for many of the homes that are actually listed for sale. [00:03:59] Speaker C: Right. And nationally, home closings decreased in September and the average days on market increased to 28 days. So just under a month's time. [00:04:09] Speaker B: Well, nothing too, nothing too terribly shaking there. New home sales. What are new home sales? They are actually the signed new home contracts. They actually rose 4.1% in September compared with to August. You know, they rose to 768,000 units and at the end of September they were 738,000. But what does that mean? That means that people are still buying homes, but it also means that during the period of time that we're talking and the reporting was made, the Federal reserve reduced by 50 basis points the mortgage interest rate. So the mortgage interest rates come down a little bit from that. It incentivized some of the buyers. So therefore new home sales picked up at that point in time. We're going to take a short break. We'll be right back. [00:05:12] Speaker D: Welcome to the Real Estate Minute with Re Max expert Michael Hatfield. Michael, what traits should we look for in selecting an agent? [00:05:19] Speaker A: Look for a dealmaker with a positive attitude who will work tirelessly for you. An agent who is adept in multiple offer situations, drafting contracts, marketing and advertising. A client's home is familiar with multiple cultures, experienced in mortgage financing. Inspections and escrow is a huge asset to his client. [00:05:40] Speaker D: What can you do as a plus for clients? [00:05:41] Speaker A: Your agent is your eyes and your ears. One who works behind the scenes on your behalf. A great attitude, working well with others and keeping clients priorities number one is a given for us. [00:05:53] Speaker D: Call 925-322-7775 now to schedule an appointment or complimentary home analysis. For excellence in real estate, call the Michael Hatfield ReMax team at 925-322-7775 or go to michaelhatfieldhomes.com well, we were in. [00:06:10] Speaker E: The market to buy a house in Pleasanton for a very long time. So we saw this beautiful house. We walk in, we see Michael and Nancy. We just absolutely love this house. Michael brought in a wealth of knowledge and experience to the whole home buying process. He was very professional. And both Michael and Nancy went way above and beyond to help us and to help us achieve the house of our dreams. [00:06:35] Speaker B: Now back to our show. [00:06:38] Speaker C: Right, Right. Jobless claims continue to affect the home buying market as they remain at a higher level. And there is a whiskey spur of a slowing economy ahead. [00:06:50] Speaker B: Well, what does that slowing economy actually mean, Nance? It means that the economy may be slowing down. It maybe it takes a little longer of your home in the market if you have it listed for sale, but it doesn't mean the property prices are going to decrease by a huge amount. And I think that the market is pretty resilient at this point in time. We just have an absence of buyers and we have an absence of sellers. Therefore, it's staying somewhat, I would say, thin in number of transactions that are actually taking place. That's by the way I see it. What about job openings? [00:07:28] Speaker C: Right. So job openings have fallen to their lowest levels since January of 2021. New data from the Bureau of Labor Statistics released Wednesday show that there were 7.44 million jobs open at the end of September. That's a decrease from the 7.86 million seen in August and the lowest level of job openings since January of 2021. [00:07:56] Speaker B: Well, you know, jobs are really important in our economy. If the jobs report comes in to where it's not favorable, then everybody kind of takes a look around and says, wait and see. I'm not going to buy a house. I'm not going to sell a house. I'm just going to wait and see. We've been seeing a lot of the wait and see just recently. And according to many of the agents, there's another factor that's come involved. And there was a settlement against the national association of Realtors. The lawsuit was called Sitzer Burnett. And that settlement manifested itself into the introduction of many more documents in the home sale transaction. In the home sale transaction, one of such documents is called the buyer representation Agreement. It's a five page document. And if you want to go and look at a home, your realtor is going to look at you and say, okay, sign this and you're going to look at it and say, oh, this thing is scary. But it's essentially a document that says you will pay your buyer's broker and agent if someone else doesn't pay. That's essentially what it says. However, many of the buyer's brokers still ask the seller to make a concession and pay the buyer's broker and the buyer's agent. And essentially that's how it works out. But nevertheless, it drives this little wedge in between buyers and the buyer's agents and makes it tough, makes it makes them kind of balk for a minute and say, okay, well, you know, I don't know if I'm going to buy a house because this has got me scared. And hopefully your agent will explain those documents in totality, unlike my brief flyover that we have here. So the comfort level has not yet reached buyers that are having to sign in order to go look at homes and be shown on a buyer's tour. [00:09:51] Speaker C: Right. That's still catching up. So the leading economic index, which is a broad look at the overall economy and tries to point where the economy is going in the near term, reported September that It was down 0.5%, August was down 0.3%, and the report has been unfortunately negative for the last 29 out of 30 months. [00:10:16] Speaker B: So let me, let me get this right. So the leading economic index, that is a gathering together of a lot of economic indicators and it is to actually say, well, the economy is going here. That's what the intention of this report index. The index report is 4. So out of the last 29 of 30 months. Yes, this report has been negative. It's been unfavorable, unfortunately, to where the economy is going. But then there's something I have to say is that when you have, when you have these indicators indicating the economy is going to be not as favorable, where do you want to put your money? Nas? [00:11:08] Speaker C: Hard assets. [00:11:09] Speaker B: Hard assets. [00:11:10] Speaker C: Real estate. [00:11:11] Speaker B: Yeah. Like your home. [00:11:12] Speaker C: Yes. [00:11:13] Speaker B: Put them in your home. Put the money in your home. Because hard assets such as your home are the best place to hedge against inflation. Absolutely. Absolutely. So I'm thinking that my take on the leading economic index is not as critical, even though it seems like it would be as other reports of homeownership and the inventory that is going to tell you how vital that the real estate market is going to be. [00:11:43] Speaker C: Good to know. [00:11:44] Speaker B: Absolutely. So you're listening to the Real Estate and More show, and I'm your host, Michael Hatfield and your other host over there, Nancy Hatfield. We're glad you're on board with Us talking today. Let's get back to talking more about how's the market. [00:12:00] Speaker C: We are in the fall season typically when home sales are seasonally muted per the annual cycle and we're closing into the new year, 2025. Some potential home buyers say they are in a wait and see mode until after the new year. And you know, I don't know you need to talk about that. But. [00:12:20] Speaker B: Well, I don't know what to say about that. But it is a seasonal time of year. August, September or October, it's going to start raining here moment. The market doesn't really have a lot of vitality until the spring. Usually when the sun starts coming out, it's a new year, people have dealt with their tax issues and so forth. Then it comes up which is going to lead us into the next critical part of our episode today. Let's talk about what is being projected for 2025. The California association of Realtors has looked into their magic crystal ball and they project a 10.5% increase in single family home sales. They're projecting 304,000 plus units to be sold in 2025. So if over the state they're projecting 10.5% increase in home sales, then in the Bay Area you can expect it to be a higher percentage. So again, they're saying that 10.5% increase in single family home sales in 2025. [00:13:33] Speaker C: Impressive. The California association of Realtors, sorry about that, has looked in. Sorry. The California association of Realtors orb is projecting a medium homes price of 909,400 in 2025. This projection they say is due to high demand. [00:13:55] Speaker B: Wow, that's interesting. So they're saying in the entire state the average medium home price, or let's say medium home price is going to be $909,000. Now that is the price that they're projecting in 2025 and that's due to a high demand. Okay. So mortgage rates, they are meaning the California association of Realtors, they're saying that they're still going to be 5.9% in 2025. And their projections are based on that. Well, that's really pretty good. So if you have a 10.5% vitality in all of California, in the Bay Area it's going to be greater and in the Bay Area it's likely to be a higher medium home unit in 2025. [00:14:48] Speaker C: Because. [00:14:49] Speaker B: Because it's very vital here and the Bay Area as opposed to the rest of the state. So but then I wanted to say my take on mortgage rates is that when they hit that magic point of about 5.5%, buyers come out of the woodwork looking to buy that extra loaf of bread that's on the shelf at the supermarket. They get all excited. And if it goes to 5.0%, you get a lot of ref. A lot of people thinking, okay, maybe it's time for me to move. But it really incentivizes the buyers in the market. So anyway, that's what I got to say. Well, a little bit earlier I said, well, the market has been a little bit thin at the moment in October, September, in August. Okay. Well, anyway, housing inventory has increased. So that's been one of the reasons for that to actually happen. Some say 34% since July. The mortgage inventory, not mortgage, the home inventory has increased like 34% since July. That's a lot of homes coming on the market for sale. What say you? [00:16:01] Speaker C: Yes, yes. [00:16:04] Speaker B: So we talked earlier about the new documentation that's put a little bit of a squeeze on various buyers. They're not like signing that five page buyer representation agreement. But hey, guys, just get used to it. Just pick a really great, experienced real estate team. And if you want to know who that could be, just give us a call. You got our number and we'd be happy to help you if you're nice people. But the five page buyer representation agreement, at some point, people will become very familiar with it and very comfortable with it and they'll move forward into buying their home and not letting it be a reason to wait and see first. [00:16:46] Speaker C: Exactly. So while mortgage rates improved half a point a few weeks back, they bounced back up to over 6% in a very short time after that, reduction. And homebuyers who are ultra sensitive to rates just decided to again, wait and see. [00:17:03] Speaker B: So that's another reason, another reason that the market has been less active, so to speak. [00:17:09] Speaker C: Right, right. Let's talk now about seasonal fluctuations, inflation and uncertainty in the economy. Michael. [00:17:16] Speaker B: Oh, so now you kind of want to wrap it up just a little bit. Well, let's do that. Well, what new laws the government may impose on the housing market has got something to do with buyers taking a moment to wait and see. Specifically rental restrictions for landlords. People don't really know what the government may be doing on that. You're seeing a lot of initiatives, so to speak, at various levels in our election process, and it's going to be hard to actually determine exactly how these will affect a potential new homeowner. So there's people that buy homes to live in, and there's people that buy homes to have as an investment to rent out to others, provide a home service and people are uncertain as to what that could very well mean. So they going to take that, wait and see and have a little bit of hesitancy before they buy another one. Inflation is real. We said earlier that paying attention to all of the inflationary factors, you know, anybody knows that when they go to the grocery store nowadays, when you come out of there, you've got less in your pocket and you've actually got less in your bag too, which is unfortunate. But even at the gas pump, the hardware store, inflation is here, folks. I don't care what the reports say. Look at your pocketbook. It will tell you exactly what is going on inflation wise. You know, back in the day I had supermarkets and there was a fellow that I'd worked with before I actually bought my first supermarket and he said, you know, it's great to have all of these reportings, computer wise reportings that you'll have on what's what, but look at your bank account. Well, I'm saying the same thing here. Look at your pocketbook and say, is inflation real? I mean, is it real or, or, or not? And most people will say, yeah, I got less money in my pocket. Less money in the paper bag that we carry away the groceries with. We're going to take a short break. We'll be right back. [00:19:30] Speaker D: Welcome to the Real estate minute with ReMax expert Michael Hatfield. Michael, what traits should we look for in selecting an agent? [00:19:37] Speaker A: Look for a dealmaker with a positive attitude who will work tirelessly for you. An agent who is adept in multiple offer situations, drafting, contracts, marketing and advertising. A client's home is familiar with multiple cultures, experienced in mortgage financing, inspections and escrow is a huge asset to his client. [00:19:57] Speaker D: What can you do as a plus for clients? [00:19:59] Speaker A: Your agent is your eyes and your ears. One who works behind the scenes on your behalf, a great attitude, working well with others and keeping Clients Priorities number one is a given for us. [00:20:11] Speaker D: Call 925-322-7775. Now to schedule an appointment or complimentary home analysis. For excellence in real estate, call the Michael Hatfield ReMax team at 925-322-7777 or go to michaelhatfieldhomes.com well, we were in. [00:20:28] Speaker E: The market to buy a house in Pleasanton for a very long time. So we saw this beautiful house. We walk in, we see Michael and Nancy. We just absolutely love this house. Michael brought in a wealth of knowledge and experience to the whole home buying process. He was very professional. And both Michael and Nancy went way above and beyond to help us and to help us achieve the house of our dreams. [00:20:53] Speaker B: Now back to our show. [00:20:57] Speaker C: Right at the end of the month, you look what's in your checking account and you, you know, so let's talk about increased home inventory for sale. More homes are for sale on the market for a same number of last month's buyers. And that doesn't make for a vital market. And it'll wait for, they'll wait for correction. You know, that's what people are saying for a correction. [00:21:19] Speaker B: A lot of people, a lot of people say, well, I'm going to wait till the market crashes or the market pulls back and actually prices are much, much less. Well, folks, my own opinion, I don't see that happening. I see that the demand is very high. People are living with other people to get by until they feel that it's the absolute best time to buy. I don't see a huge market correction. I do not see that. I see that the price of homes is going to stay up there. I align myself with my thoughts, my opinion with what the California association of Realtors are saying for 2025. [00:22:05] Speaker C: Got it. [00:22:06] Speaker B: And even though the economy is a little sluggish, where's the best place to put your your money? [00:22:13] Speaker C: Nance Hard Assets. [00:22:15] Speaker B: Home assets. Absolutely. Buy that home that you've been thinking about. And also pay a little bit more attention to what Fannie Mae is forecast for the rest of the year. They're saying slow economic growth for the remainder of 2024. But yet next year they're saying Fannie Mae sea old crystal ball is projecting 2025 there will be more home sales and a 3.6% rise in home prices due to a more sustainable consumer spending trend going forward. [00:22:49] Speaker C: And we'll be out of the election season too. And that'll definitely help because I think. [00:22:54] Speaker B: We'Re out of election season. [00:22:55] Speaker C: Right? Right. We're out of it. So in November, mortgage rates continue to be 6.4% 30 year fixed, essentially unchanged for many, many months. [00:23:06] Speaker B: Wow. Yeah. So it's never really been like that in the past. I mean, most election years the mortgage rates have dropp and have given a break to people that want to leverage their buy and get into a new home. But this has been one that's a little bit odd. It has not went down. [00:23:26] Speaker C: Right. [00:23:27] Speaker B: So for the year coming forward, I'm seeing that we're getting low on our time here. I think that we have to think about buying a house by the Way, we have a colleague up in Reno. I like to talk about her. She's really a nice lady, really sharp realtor by the name of Erin Merritt. And Erin is famous in my head for saying, you know, buy the home, then date the rate. And to explain that, she means find the home that you want when the market is not going crazy, and right now it's not going crazy, then date the rate and wait until the, you know, once you're in the home, just wait until the rate is where you want it to be, then refinance the home. So that's what I got to say about that one. [00:24:15] Speaker C: Sounds good. So next, let's talk about who's selling their homes right now. [00:24:22] Speaker B: Okay, who is? [00:24:23] Speaker C: Well, homeowners with ultra low mortgages are not. They're intending to stay instead of listing their homes and accepting today's rates of the 6% or more and this phenomenon known as the rate lock, in effect, they're just staying put because of that low rate. And so who is selling these days? [00:24:44] Speaker B: Well, the only people that are really selling are there's estate sales by successor trustees or beneficiaries, relocations due to jobs, relocations due to retirement and retirement locations that are, you know, enticing and necessity due to health reasons and parties unfortunately due to divorce. [00:25:04] Speaker C: Yeah, that's a hard part. [00:25:06] Speaker B: Absolutely. Well, Nancy, let's switch gears for a short second. It is a great time to buy right now. It's not a bad time to sell either. And it takes a little while once you meet with your experienced professionals to make your home ready to put on the market. So keep that in mind. You might want to cut the grass, you might want to remove the implements that might be in your front yard, such as who knows what, paint the house, do that kind of a thing. It takes a little time from the time you decide to sell your home. So keep that in mind if you should decide to sell. So we're switching gears. What are the 10 steps to purchasing a home? [00:25:45] Speaker C: Number UNO1, choose the right experienced real estate agent. [00:25:50] Speaker B: Well, I have to agree with that. If you don't know who that is, give us a call, we'll tell you. I know. [00:25:55] Speaker C: Great. One sitting across table for me. Number two would be know your budget. [00:26:00] Speaker B: Yeah. [00:26:01] Speaker C: Three, explore mortgage options. Get pre approval or pre qual letter. [00:26:05] Speaker B: Yeah. And you're good in your great real estate agent. Your experienced agents are going to hook you up with potential proven lenders that work well with clients. Because in our, in our profession, I care about our clients, number one and I know Nancy does, too. We want to make sure that they get the best financing package for their home, best rate, best package, and making sure that it actually does well. So then number four is browse homes online. Ask your agent to send you MLS reports. That's so that you can take a look at what's out there and refine your desires. And then you're going to identify those homes, and then your agent will schedule the tours. [00:26:56] Speaker C: That's right. We do that very well. When you find the one, the home, make an offer. Do not delay. Make that offer. If that's the home you like. [00:27:04] Speaker B: Yeah. What's that guy Mark Twain said? He said, I seldom recognize an opportunity until it's passed me by. Well, if you see the opportunity, don't let it pass you by. [00:27:15] Speaker C: Don't be one of those. [00:27:17] Speaker B: Right. [00:27:17] Speaker C: So sad. And then ensure you have the proper inspection. [00:27:21] Speaker B: Inspections. And your agent will definitely do that for you. Either the seller paid for inspections or you'll have to make them. But you definitely need to have inspections done on a new home so you know what you're buying, know what price you're paying, and match the two together or marry the two together. In other words, very important. [00:27:40] Speaker C: And then once your offer is accepted. [00:27:42] Speaker B: Being meticulous in closing the deal. You want to be very meticulous in closing the deal. Be ready for your escrow officer when they call, you know, hey, can you give me this? Can you give me that? But your. Your agent will guide you through all of that. And it is a complex process, but it's a great process. [00:28:02] Speaker C: Update utilities, transfer services, get your home insurances that you want. [00:28:08] Speaker B: And then number 10, moving in. [00:28:12] Speaker C: Absolutely. Moving. [00:28:14] Speaker B: Well, with all this information, should I buy or should I sell? And I just have to say you can do either one right now, and I don't think you're going to get hurt. The market is a little bit thin at the moment. That's a great time to buy because next year everyone's projecting it will be more vital of a market. So I'm thinking, hey, get with it, go for it and get going. Wouldn't you say so, Nance? [00:28:39] Speaker C: I would say so, absolutely. [00:28:43] Speaker B: I believe that rates at some point will come down, you can refinance your new home. And if you're a potential seller and you have gridlock because of the fact that you've been in the home for 30 years, you have this and that everywhere we have people and your experience, really good real estate agents will help you hook you up with these people. That will help clean it all out and take care of it so that you'll have a home that you can pass over to the new buyer. So, Nance, thank you for being on the show today. You're just amazing. I sure appreciate it. [00:29:19] Speaker C: Thanks, Michael. [00:29:21] Speaker B: You've been listening to the Real Estate and More show. Help our show by going to our YouTube channel at my real talk show that as a @myrealtalkshow and touch the subscribe and the like buttons if you would be so kind. We'll be back next week with another interesting show. I hope you'll tune in. Have a very blessed week. Thanks again, Nance. [00:29:43] Speaker C: Have a great week. [00:29:44] Speaker B: Please remember to go to our new YouTube handle, MyRealTalkShow. That's [email protected] and touch that subscribe button. You can also find past aired shows at our handle myrealtalkshow on YouTube dot com.