What’s Happening With The East Bay Market?

I’m not going to sugarcoat it, and I’m definitely not going to lie to you; it’s an odd, uncertain time in the East Bay real estate market. 

Interest rates have nearly doubled since last year, significantly slowing down the speed at which inventory moves through the market. Rising interest rates have collided with an anxious stock market and nationwide fears of recession to create an atypical amount of worry surrounding Bay Area housing.

As a result, fewer properties are being listed, and fewer properties are being sold, with many sellers electing to hold off on listing for a time when the market picks back up. And it’s not just the Bay Area– according to C.A.R., housing sales have fallen more than 37 percent in California between July of 2021 and July 2022. Locally, we’ve seen a 30 percent deceleration in housing sales in the East Bay. However, in the deceleration seen all across California and in the Bay Area, there lies opportunity for certain buyers. 

From my own experience, I’ve seen a large number of properties sell over the past year with significantly fewer offers than they would have received in 2020 or even most of 2021. A property that might have once gotten 10 or more offers might now receive only 1 or 2 offers– if they get any at all! Properties all across the East Bay have seen their prices reduced significantly to attract prospective buyers. Alternatively, some properties have seen their listed prices increase– not in an attempt to price gouge in a buyer’s market, but instead in an effort to more transparently reflect what the actual sale price will be. 

Gone (for now) are the days of the average East Bay property closing for 150% or more of its list price. For the time being, prospective home buyers can rest much more confidently that offers submitted around list price may actually be accepted. 

Interest rates being what they are, the East Bay housing market is now fundamentally much easier to enter for new buyers. Many new buyers find themselves squeezed out of the market by its typical hyper-competitiveness, but most of that competition has taken to hibernating until the market conditions change. As such, motivated new buyers presently have a much greater opportunity to get into the market and land the properties they have their eyes on than they would have seen in 2020– or are likely to see in 2023 or 2024.