2015 was an amazing year for most home owners in Santa Clara and San Mateo County. Median price increased to $1,250,000 from $1,050,000 in San Mateo County. While in Santa Clara county, the median price increased to $950,000 from $852,000, roughly a 11.5% increase. The number of closed transactions was slightly lower in 2015 than in 2014. In most areas, the inventory continues to be very tight. It is roughly 10% lower when compare with years from 2010 to 2013. We continue to see this theme continues into 2016. This is a good time for home owners who are considering selling.
2015 was a tough year for many buyers because of the low inventory and fast rising price. The Federal Reserve only recently raised the rate in the last December meeting in 2015. Surprisingly, the 30 years fixed rate mortgage were largely remained unchanged. “We expect the 30-year mortgage rate to be above 4 percent in early 2016 and anticipate rates will gradually increase, averaging 4.4 percent for the year”, quoted by Sean Becketti, Freddie Mac’s chief economist.
Most economists agree that housing prices and sales will continue to grow in 2016, but at a slower pace. The market will continue to be strong but at a slower appreciation pace. The housing market is favored by low mortgage rate, strong job and income growth. On the flip side, the low inventory and low affordability remains a challenge for many buyers.
Interested to learn more? A detailed report will be available at the end of January, please send me a note if you like more information.