Livermore housing market update by Steve Eveleth
As we enter the 3rd quarter we're seeing a definite breath in the Livermore Ca housing market. With average days on market now 41 its clear buyers are thinking twice and taking their time before pulling the trigger. We are seeing price reductions more often and longer time on market.
This 3rd quarter trend is often times to be expected this time of year many say, others boost a "cooling off" or "correction" in the Livermore Real Estate market. Open house activity is reduced to about half the traffic at many Livermore Ca listings compared to the "hot time of year" which has passed.
With record gains in the past 36 months since 2006, its clearly welcomed by many Livermore Ca first time buyers. First time buyers make up about 34% of Livermore home purchases. Many investors have taken a step back to evaluate the market and keep in eye on trends as well. One Livermore Real Estate investor says it doesn't make sense to invest in a rental if the mortgage payment far exceeds rent.
Stats show the average first time buyer combined income is about $110,000 per year in the Livermore area. A monthly mortgage payment with typical 20% down on a $600,000 entry level home is around $3,500 per month which is just about maxed out for their DTI (debt to income) ratios to qualify for a home loan.
Inventory is holding steady at around 150 homes on the market which is still considered fairly low. A healthy balanced Livermore market in the past is around 225 homes on the market. Pending sales are still continuing nicely however, specially in Livermore. The homes priced well with the most to offer trump the competition and continue to sell.
Word on the street is we are entering a normal trend for this time of year. Stats say there are 2 buyers for every 1.5 available Livermore homes. The old saying location location location, along with a strong economy, population expanding, baby boomers retiring and cashing out, desirable schools, low crime, charming downtown, family orientated "slower pace" community, Livermore wineries and many other amenities, IMO the Livermore market will stay strong and healthy for a time to come, just don't expect it to continue at the accelerated pace it has in the past few years.
I predict a 1-5% increase in the housing market for 2016 as long as rates stay were they are. If they raise rates anytime soon with the market already cooling off it may effect prices and reverse my predicted 1-5% gains to price reductions which would be good news for buyers. I do not however see any type of crash on the near horizon, nor would it be a correction because Livermore homes are still quit affordable considering the location compared to home prices in the greater Bay Area. Just a healthy "balancing" I believe is in store! Good luck with your Real Estate moves and think smart for the long term as Real Estate is always a great investment!
By Steve Eveleth Livermore Ca Real Estate Specialist.
(please note this blog is all my opinion only)