Regarding your June 24, 2023, column titled “Is saving money worth the potential of stigmatizing your home after a failed sale?” on The Mercury News and East Bay Times websites:
Question: You listed home prices for May 2023 in Silicon Valley. The lease on our apartment is about to expire. My in-laws want us to buy a home because realty prices dropped. Have realty prices fallen in all Bay Area counties?
Answer: According to the California Association of Realtors (C.A.R.), Bay Area existing-home sales and prices have receded by 19.7% and 2.7%, respectively, from June 2022 to June 2023. Yet, a seller’s market remains. On July 19, 2023, I was on a Zoom call with the 2020 C.A.R. president. He proclaimed that 85% of the single-family home sales for the prior week in Santa Clara County, aka Santa Clara Valley and Silicon Valley, were noncontingent. That’s alarming. Those homebuyers did not have an escape clause written into their purchase contracts. In other words, ratifying a noncontingent purchase contract risks the homebuyer’s earnest money deposit. This tactic is driven by agents. In times of low housing inventory, eliminating the homebuyer’s ability to cancel a home sale and retrieve their earnest money deposit is encouraged. A white-hot seller’s market sees this as a so-called “strengthening the offer” noncontingent gambit.
I’m against noncontingent offers; you should be, too. Find a San Francisco Bay Area county with home prices that fit your budget — if possible. Let’s examine the files from research and economics at C.A.R. These June 2023 prices are 6.71% interest rate examples. Then, you’ll need a buyer’s agent strong enough to present a purchase offer with contingencies through a seller and seller’s agent who are savvy enough to ratify it.
• In Alameda County, the median price of a three-bedroom home of $950,000 with a 3% down payment of $29,000 is a monthly payment of $7,047; with a 20% down payment of $190,000, it is a monthly payment of $6,004.
• In Contra Costa County, the median price of a three-bedroom home of $785,000 with a 3% down payment of $24,000 is a monthly payment of $5,824; with a 20% down payment of $157,000, it is a monthly payment of $4,962.
• In Marin County, the median price of a three-bedroom home of $1,420,000 with a 3% down payment of $42,000 is a monthly payment of $10,497; with a 20% down payment of $283,000, it is a monthly payment of $8,942.
• In Napa County, the median price of a three-bedroom home of $1,620,000 with a 3% down payment of $49,000 is a monthly payment of $12,036; with a 20% down payment of $325,000, it is a monthly payment of $10,254.
• In San Francisco County, the median price of a three-bedroom home of $1,650,000 with a 3% down payment of $50,000 is a monthly payment of $12,240; with a 20% down payment of $330,000, it is a monthly payment of $10,427.
• In San Mateo County, the median price of a three-bedroom home of $1,740,000 with a 3% down payment of $52,000 is a monthly payment of $12,934; with a 20% down payment of $349,000, it is a monthly payment of $11,018.
• In Santa Clara County, the median price of a three-bedroom home of $1,555,000 with a 3% down payment of $47,000 is a monthly payment of $11,498; with a 20% down payment of $310,000, it is a monthly payment of $9,795.
• In Solano County, the median price of a three-bedroom home of $627,000 with a 3% down payment of $19,000 is a monthly payment of $4,651; with a 20% down payment of $125,000, it is a monthly payment of $3,962.
• In Sonoma County, the median price of a three-bedroom home of $1,100,000 with a 3% down payment of $33,000 is a monthly payment of $8,138; with a 20% down payment of $219,000, it is a monthly payment of $6,933.
For Housing Market Data in your area, visit my webpage for trends here. Do you have questions about home buying or selling? Full-service Realtor Pat Kapowich is a Certified Trust and Probate Specialist, Certified Real Estate Brokerage Manager and career-long consumer protection advocate. He is based in his hometown of Sunnyvale, California. Office: 408-245-7700; Broker# 00979413 [email protected]