Berkeley-Oakland Real Estate

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The “Window” in East Bay Real Estate

See what homes are for sale now in Berkeley

See what homes are for sale now in Oakland

 

“We are in an ‘Opportunity Window’ of real estate until Fall, 2015.” That’s the outlook of Bay Area Real Estate Economist, Carole Rodoni, who recently spoke at a McGuire Summit.   She made these points:

·         She believes Fed Reserve Chairman Janet Yellen will leave interest rates low until then – so as not to upset the real estate/stock markets that have finally gotten back on their feet.   A 4.5% interest rate, she said, is essentially cheap  money compared to the 30-year average mortgage rate of 7%, which it will return to once the Fed stops subsidizing.  Her point is that at 4.5%, actually 29% of your mortgage payment goes toward building equity compared to the usual 9% at a 7% interest rate.


·         Another point.  We are not in a bubble in Bay Area real estate … rather a “revolution” or a structural change in the economy due to the Internet.  This means changes in the way people live and work.  The near East Bay is a prime area to reap the benefits.  Compared to the City, where the average price per square foot for houses is upwards of $1000/sf, homes in the East Bay are still affordable.  (In Berkeley, the average price/sf is $595 with an average sale price of $944K.  In Alameda, it’s $442/sf with an average price of $756K.  And in Oakland, it’s $390/sf with an average sale price of $641K.) 

·         The market right now is being driven by “Millennials” with cash, many of whom come to the East Bay from the City.  These Buyers want to be close to BART and connected.  They like funky and urban as opposed to lush and suburban of previous Buyers. 

That all bodes well for real estate in the near East Bay.  However, as Carole warns, these Buyers are now pickier than they were last year… not as desperate as last year.  She warns Sellers not to be greedy … and not to wait until interest rates go up.  And the window closes.

 

For a short meeting on how to take advantage of this real estate window, just give me a call:  510 847 2409.  

McGuire Real Estate

Leading Real Estate Companies of the World

Barbara Reynolds, MacGuire Real Estate, East Bay Real Estate Specialists

Real Estate Blog Directory

 

Comment balloon 0 commentsBarbara Reynolds • September 11 2014 11:52AM

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