Four Reasons Why Dublin Will Have Another “Seller’s Summer”.
It might only be April, but it already feels like it’s summer in Dublin Ranch. That’s not just because of the heat, either—the hottest months are often host to the highest peaks in the real estate market. And the most recent data suggests that we could be pushing into an early (and hot) seller’s summer. We’ve assembled a list of several reasons to think this (and why this may be the perfect time to put your Dublin home up for sale):
- Home prices recently skyrocketed. According to Clarus Market Metrics, last month saw some of the largest price gains and highest averages in recent memory. On detached single-family homes, the median closing price rose to $900,000 (a year-over-year increase of 37 percent); for condos and townhouses, the median jumped to $595,000 (a staggering year-over-year increase of 49 percent). In the case of condos and townhouses, the average list price remains lower than the closing price by $56,500, which indicates a strong demand for these homes even with the price increase.
- Unemployment rates are dropping. As this Pacific Union article explains, at a 5 percent unemployment rate, Alameda County is now considered “fully employed”. Since workers tend to use their increased income to seek out homes closer to their workplaces and “upgrade” their housing situations, higher employment numbers correlate with an increased demand for homes. However…
- Inventory continues to shrink. In March, “months supply of inventory” — the amount of time it would take to sell all currently marketed homes if no more were added—contracted to a mere 0.5 months. To put this in perspective, anything less than six months is considered a “seller’s market”. With such a low inventory, it will become increasingly difficult for prospective buyers to find a home to purchase that meets their criteria; it also means that buyers have very little leverage in closing prices. These factors would typically encourage buyers to look into new housing developments, which brings us to our fourth point:
- It is unlikely that construction will be able to address the demand for housing. A recent KQED article describes how, for every thousand new Bay Area residents, fewer than two hundred housing permits are being issued, and that California has some of the lowest residential construction rates in the entire country. In places where construction has outpaced demand (like parts of Florida), home prices have subsequently dropped. By comparison, it is doubtful that the current pace of construction will have a significant effect on rising prices in the Bay Area.
As a result, it’s shaping up to be another summer with homeowners enjoying considerable influence on housing prices in a market filled with competitive buyers and multiple offers. However, like we’ve said in the past: If the market gets hot enough to draw additional sellers, it will be critical to start off with a company that can help you make the most of a good situation and maximize returns on your hard-earned equity. Start off on the right foot by contacting Lifestyle Real Estate Services today!