CAMPBELL -- In the rough-and-tumble Bay Area real estate market, buying or selling a home is already tough enough. One woman is attempting both at the same time.
Real estate agent Christine Burroughs is selling her current home in Campbell, and is also looking for a new one, during a most usual time. The Home Purchase Sentiment Index, which tracks how people feel about home buying, is now at a 10-year low. Buyers haven't been this pessimistic in a decade.
"Everything stopped when it was perceived that the media was saying the sky was falling," said Burroughs. "It's not ... Not even close."
"So, what we're seeing on the streets is a return to a normal market," said Brad Gill, founder of real estate agency NextHome Lifestyles.
Gill said during the pandemic, Santa Clara County saw sharp growth. From spring 2021 to 2022, home prices were up 30%, as people working from home upgraded and wanted more room. He adds that with the NASDAQ down for the year, record inflation and interest rates rising into the mid 5s, it's cooling off buyers.
"We don't want buyers out there over-bidding properties continuously throughout the entire year going over $200,000, because it increases prices too fast, and that's how we run into trouble," said Gill. "With homes sitting on the market longer, buyers can make offers with lower down payment programs."
Gill says the market favors first-time homebuyers, for something like a 3-bed, 1-bath in Santa Clara, with an asking price of just under $1 million.
"So it's only going to take, you know, 50% of the down payment or less, than it was in the previous market," said Gill. "Because the previous market needed a 20% down as well as additional in case there was any overbidding that you had to do, above and beyond what the house would appraise for."
Burroughs says if you're thinking about buying a home now, do not compare today's mortgage rates to the historic lows we saw during the darkest days of the pandemic.
"Don't overthink it. Don't overthink the interest rates because it's all relative," said Burroughs. "The interest rate is low as you compare it to the history of interest rates. And I remember when interest rates were 16 or 17% for a first mortgage.
"This is nothing," she laughed. "This is still almost free money."
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