tag:blogger.com,1999:blog-66773560735870790622024-03-27T02:26:59.411-07:00Alan Wang Realty Group Real Estate BloggerWelcome to Alan Wang's Real Estate Blogger. Alan specializes in residential Real Estate fully representing Buyers and Sellers with their Real Estate Needs. Check back here for market outlooks, mortgage rates and new listings! I am also available online at http://www.alanwangrealty.com.Unknownnoreply@blogger.comBlogger125125tag:blogger.com,1999:blog-6677356073587079062.post-21765483926016415642024-02-25T18:32:00.000-08:002024-02-26T10:27:09.417-08:00February 2024 Silicon Valley Real Estate Update - Aggressive Bidding Wars are Back<div class="separator"><div class="separator" style="clear: both; text-align: left;"><span style="text-align: justify;">As predicted in our 2023 year in review, imagine if the rates went down how competitive the market would be? 2024 answered this question and the answer is aggressive bidding wars. The market has kicked off on fire for Sellers. Rates dropped from half a percent to a full percent and Buyers are done delaying their home purchases. More Sellers are content with the lower rates and putting their homes out for sale than 2023, although it will be unlikely to be enough to satisfy demand. We expect 2024 to be a Sellers’ market.</span></div></div><div class="separator"><span style="text-align: justify;"><br /></span></div><div class="separator"><span style="text-align: justify;"><div class="separator" style="text-align: left;"><div class="separator" style="clear: both; text-align: center;"><a href="https://youtu.be/NiCYEU2QXdE" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" data-original-height="405" data-original-width="720" height="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgR7-LbV-yifRH7V13lhkBzcSIvvZRoUhRXpPrcjRK3AlyTXxk_vuUw2UcDtIFe5MOXULTz-1nwXHbtzsq-VdkcbljfE2JvxVJPoh-oNNxdiJXbYJrdxWNcRvvskP3-itK37-i_SoPj0zRatZNZtVAykUwBe2xuCEluOA90_X5v99n8cIRflS-Drqv3eK5s/w400-h225/February%202024%20Silicon%20Valley%20Real%20Estate%20Update.jpg" width="400" /></a></div></div><div class="separator" style="clear: both; text-align: center;"><i><span style="text-align: justify;">Video Summary - </span><a href="https://youtu.be/NiCYEU2QXdE" style="text-align: justify;">https://youtu.be/NiCYEU2QXdE</a></i></div></span></div><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;"><b>Live Listing Case Studies<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;">Here are some live case studies from our home sales this year.:<o:p></o:p></p><p class="MsoListParagraphCxSpFirst" style="mso-list: l0 level1 lfo1; text-align: justify; text-indent: -0.25in; text-justify: inter-ideograph;"></p><ul><li><span style="font-size: 12pt; text-indent: -0.25in;">1166 Spencer, Mountain View, CA – 7 Offers, Sold $292,000,</span><span style="font-size: 12pt; text-indent: -0.25in;"> </span><span style="font-size: 12pt; text-indent: -0.25in;"> </span><span style="font-size: 12pt; text-indent: -0.25in;">6.8% Over List Price</span></li><li><span style="font-size: 12pt; text-indent: -0.25in;">632 Spruce, Sunnyvale, CA – 20 Offers, Sold $617,000, 29.5% Over List Price</span></li><li><span style="font-size: 12pt; text-indent: -0.25in;">656 Giannini, Santa Clara, CA – 20 Offers, Sold Price - $2,450,000, $552,000, 29% Over List Price</span></li><li><span style="font-size: 12pt; text-indent: -0.25in;">921 Gridley, San Jose, CA – 14 Offers, Sold 20%+ Over List, Sale Pending</span></li><li><span style="font-size: 12pt; text-indent: -0.25in;">2426 Cory, San Jose, CA – 12 Offers, Sold Off Market 20%+ Over List, Sale Pending</span></li></ul><!--[if !supportLists]--><o:p></o:p><p></p><p class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-align: justify; text-indent: -0.25in; text-justify: inter-ideograph;"><o:p></o:p></p><p class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-align: justify; text-indent: -0.25in; text-justify: inter-ideograph;"><o:p></o:p></p><p class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-align: justify; text-indent: -0.25in; text-justify: inter-ideograph;"><o:p></o:p></p><p class="MsoListParagraphCxSpLast" style="mso-list: l0 level1 lfo1; text-align: justify; text-indent: -0.25in; text-justify: inter-ideograph;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;"><b>Inflation Rates</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;">Inflation rates rose slightly in December and dropped in January. We are seeing an uptick in February. With these 2 increases, the Federal is in no hurry to drop interest rates.<o:p></o:p></p><div style="margin-left: 1em; margin-right: 1em; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh3t8EgwgjV_tXpEsSe2u0sdkpIceDvcNoWww7lq4kqnQmoEVdzvjGbGsNr04uQ5rGtRtySIYlwNUS-dvXsW93_RICp8LHBGzhjSppffk6XfldAAHZm65mSQ-8mg4nCrTEStK0AsxEsKYoV2-TlFLANWNSXsiasrWZNW7PxcrMB_Kah5eFTkHYlUXip4Iqi/s936/Picture1.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="524" data-original-width="936" height="224" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh3t8EgwgjV_tXpEsSe2u0sdkpIceDvcNoWww7lq4kqnQmoEVdzvjGbGsNr04uQ5rGtRtySIYlwNUS-dvXsW93_RICp8LHBGzhjSppffk6XfldAAHZm65mSQ-8mg4nCrTEStK0AsxEsKYoV2-TlFLANWNSXsiasrWZNW7PxcrMB_Kah5eFTkHYlUXip4Iqi/w400-h224/Picture1.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 1 – Inflation Rates<o:p></o:p></i></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;"><b>Mortgage Rates<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;">Rates were in the upper 6% to over 7% in 2023, which forced many Sellers stay in their current homes. This year rates have dropped to the lower 6% range but still fluctuating. This drop was enough to get more Sellers to sell their homes this year and Buyers to come back into the market in droves.<o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJCtTJPCthNxKxo7w5uT0c6BdaN3ZiIGfnXDxHpy6RQ_JSPpdMWIoFE8KuWxl9Vw96K6bNstxobKG59fnCMZuJ5hnAZKbki8ueWW24UFfUwMrPJCwXK6i2jbhirb0sUCMrgQ3JdRSIJuVllbulPrRR7BU5ZmjcBGiCu-Gr5yTTqJmwT_nC71KPBnPBjVwc/s1430/Picture2.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="806" data-original-width="1430" height="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhJCtTJPCthNxKxo7w5uT0c6BdaN3ZiIGfnXDxHpy6RQ_JSPpdMWIoFE8KuWxl9Vw96K6bNstxobKG59fnCMZuJ5hnAZKbki8ueWW24UFfUwMrPJCwXK6i2jbhirb0sUCMrgQ3JdRSIJuVllbulPrRR7BU5ZmjcBGiCu-Gr5yTTqJmwT_nC71KPBnPBjVwc/w400-h225/Picture2.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 2 – Mortgage Interest Rates Nationwide</i><o:p></o:p></p><div style="margin-left: 1em; margin-right: 1em; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjH_CCQDWtXhAvnP8YjYNepB1Mw9I6hJMvD5X2cuCy6Wr8STWfzzssPK-QD0I4xs4WpIRKfSAgo6diMiqoRwt3gt6dTnPzmOpOtCdQeZDv76K1hN4LwAPt-p0r2-kyPz0LBOjhTkgI7JNsfaff4igNrA4fHMgLKhf-VhhIZ25MmPjo1b80pKasIfUdcx_gA/s936/Picture3.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="524" data-original-width="936" height="224" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjH_CCQDWtXhAvnP8YjYNepB1Mw9I6hJMvD5X2cuCy6Wr8STWfzzssPK-QD0I4xs4WpIRKfSAgo6diMiqoRwt3gt6dTnPzmOpOtCdQeZDv76K1hN4LwAPt-p0r2-kyPz0LBOjhTkgI7JNsfaff4igNrA4fHMgLKhf-VhhIZ25MmPjo1b80pKasIfUdcx_gA/w400-h224/Picture3.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 3 – Local Mortgage Interest Wells Fargo Home Mortgage</i> </p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;"><b>NASDAQ Stock Index</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: justify;">The NASDAQ Stock Index which indicates the health of our technology companies is at an all-time high. We saw a 30% increase in 2023 and currently a 6.8% increase year to date. The majority of offers that I am reviewing are from employees at Google, Apple or Meta. The stock portfolios are the source of down payments for Silicon Valley home buyers.<o:p></o:p></p><div style="margin-left: 1em; margin-right: 1em; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjY-xiT_DFelidIDfSRGWn2bGXZQarsIHrofJgf4hbvP102ry21TfubKNCZE6lz4fave8Ak7tnHBl-6rHkVuVoRVaJItvrRvBi8wIWBzHpLj26AlgRFA-d4RibciggPaqKe0-2lzu2OVat2UFTIeC7pBZiqH8ZqnWuk6Cb3RW9LwpxcBUdSDHDOJDuatS6r/s936/Picture4.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="504" data-original-width="936" height="215" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjY-xiT_DFelidIDfSRGWn2bGXZQarsIHrofJgf4hbvP102ry21TfubKNCZE6lz4fave8Ak7tnHBl-6rHkVuVoRVaJItvrRvBi8wIWBzHpLj26AlgRFA-d4RibciggPaqKe0-2lzu2OVat2UFTIeC7pBZiqH8ZqnWuk6Cb3RW9LwpxcBUdSDHDOJDuatS6r/w400-h215/Picture4.png" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 4 – NASDAQ Stock Index</i><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;"><b>Unemployment<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;">A bit concerning is despite the stock values of technology companies at all-time highs, this has not stopped the sector from laying off and continuing hiring freezes. An issue to monitor is the unemployment rate. Traditionally at 4.5% to 4.6% in California, we are currently the rate at 5.1%. So far this is not high enough to cause any issues in the housing sector, but this is a datapoint to monitor. Despite layoffs all of last year, there were still a large number of layoffs in January of this year in the Technology sector.<o:p></o:p></p><div style="margin-left: 1em; margin-right: 1em; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi683zVJOfwuJtwCRGR9kpB7kKK2IjjcLQggnO90rW1LV97RMTd0HOaY_aiq6djOWVlTIwEQAYU0q9SOnB4Idm9778GJQqkv8tuhhb9FEGGqAFNw8JVo9MnOY4IoMo-8KYGCcDNXnrIEKTGd-e-sMe9_xqc4DZdoba0YLrhgK6JYLRwh-Rv4pIRV8heE9hG/s936/Picture5.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="516" data-original-width="936" height="220" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi683zVJOfwuJtwCRGR9kpB7kKK2IjjcLQggnO90rW1LV97RMTd0HOaY_aiq6djOWVlTIwEQAYU0q9SOnB4Idm9778GJQqkv8tuhhb9FEGGqAFNw8JVo9MnOY4IoMo-8KYGCcDNXnrIEKTGd-e-sMe9_xqc4DZdoba0YLrhgK6JYLRwh-Rv4pIRV8heE9hG/w400-h220/Picture5.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 5 – California Unemployment Rate</i><o:p></o:p></p><div style="margin-left: 1em; margin-right: 1em; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0cUYUAlr9CCJNsndyhKv9U1KKtubbXSYAHJaoc6fvo5LgCMAniqZfy4To-jbztqfbkzEaJ0OYjLu8rTwNfyS0gFONzbMLOViWQPKK44oGpMkAeAS71S3yMnq48fcPVzLD4d1krZYDSTht3N4olz7uasuVWfduM50c_XgAme9oItcOAqiqrrwpH1Nawm9g/s936/Picture6.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="580" data-original-width="936" height="248" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0cUYUAlr9CCJNsndyhKv9U1KKtubbXSYAHJaoc6fvo5LgCMAniqZfy4To-jbztqfbkzEaJ0OYjLu8rTwNfyS0gFONzbMLOViWQPKK44oGpMkAeAS71S3yMnq48fcPVzLD4d1krZYDSTht3N4olz7uasuVWfduM50c_XgAme9oItcOAqiqrrwpH1Nawm9g/w400-h248/Picture6.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-size: medium; line-height: 18.4px; text-align: center;"><i>Exhibit 6 – Layoffs in the Technology Sector</i><o:p></o:p></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;"><b>Conclusion<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;">This market is not for the faint of heart. Buyers who are your competition are armed with heavy down payments, at times cash and ready to win. Be ready to compete hard to win. The silver lining would be to try to win a home sooner rather than later, as prices are increasing every week. If you are looking to buy, you would be better off getting in and getting out and increase your equity further. Sellers you will find that the market will surprise you on pricing, but some of you will find it hard to resist the temptation to aim higher than the market is willing to pay at that moment in time. A point to note, eventually Buyers do get tired of bidding wars, so take advantage while you still can. We anticipate 2024 to continue to be an aggressive Sellers’ market for most of the year.</p><p class="MsoNormal" style="font-size: medium; line-height: 18.4px;"><b>Feeling Social?</b></p>Join the conversation on Linkedin - <a href="https://www.linkedin.com/pulse/february-2024-silicon-valley-real-estate-update-aggressive-wang-kjudc">https://www.linkedin.com/pulse/february-2024-silicon-valley-real-estate-update-aggressive-wang-kjudc</a><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br /><div class="separator" style="clear: both; text-align: center;"><br /></div><br />Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6677356073587079062.post-48909372292061481812024-01-02T19:16:00.000-08:002024-01-03T11:23:41.264-08:002023 Silicon Valley Real Estate Year-in-Review and 2024 Outlook<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://youtu.be/lwL-iUMXBRg" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" data-original-height="405" data-original-width="720" height="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDGROGZNAeW20fkwPoaIsjncD4NCgQxikgtrTNDp3bZMlv5Bn9XjXTcL-XV2R4eAACJire8EBXnAIVczJUIApBXeQfFiBRcDOuk6SxKe6L_iPyhUYN_5lBNsjeNa6A29apsyR05BpYgRGsqgJcGmye-XElOM9i9CZfrWH1XDmeKmE-om6Za1Ds6RGJi0Fl/w400-h225/2023%20Silicon%20Valley%20Real%20Estate%20Update%20Year%20in%20Review%20and%202024%20Outlook.jpg" width="400" /></a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://youtu.be/lwL-iUMXBRg" target="_blank"><span face="-apple-system, system-ui, BlinkMacSystemFont, Segoe UI, Roboto, Helvetica Neue, Fira Sans, Ubuntu, Oxygen, Oxygen Sans, Cantarell, Droid Sans, Apple Color Emoji, Segoe UI Emoji, Segoe UI Emoji, Segoe UI Symbol, Lucida Grande, Helvetica, Arial, sans-serif"><span color="var(--color-action)" style="border: var(--artdeco-reset-link-border-zero); box-sizing: inherit; cursor: pointer; font-size: 14px; margin: var(--artdeco-reset-base-margin-zero); padding: var(--artdeco-reset-base-padding-zero); touch-action: manipulation; vertical-align: var(--artdeco-reset-base-vertical-align-baseline); white-space: break-spaces;">V</span></span>ideo Summary</a> - <a class="article-editor-content__link article-editor-content__link" href="https://youtu.be/lwL-iUMXBRg" rel="noopener noreferrer" style="border: var(--artdeco-reset-link-border-zero); box-sizing: inherit; color: var(--color-action); cursor: pointer; font-family: -apple-system, system-ui, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", "Fira Sans", Ubuntu, Oxygen, "Oxygen Sans", Cantarell, "Droid Sans", "Apple Color Emoji", "Segoe UI Emoji", "Segoe UI Emoji", "Segoe UI Symbol", "Lucida Grande", Helvetica, Arial, sans-serif; font-size: 14px; margin: var(--artdeco-reset-base-margin-zero); overflow-wrap: break-word; padding: var(--artdeco-reset-base-padding-zero); text-decoration: var(--artdeco-reset-link-text-decoration-none); touch-action: manipulation; vertical-align: var(--artdeco-reset-base-vertical-align-baseline); white-space: break-spaces;" target="_blank">https://youtu.be/lwL-iUMXBRg</a></div><p></p><p><span face="Calibri, sans-serif" style="text-indent: 0.5in;">We wish you and your families a happy new year and hope the holidays were a good time to travel and to get some rest. 2023 was a very different year in real estate, the most different that we have seen in 20 years in the business. Interest rates were in the upper 6% to 7% ranges, causing Sellers to pause and stay in their homes as the switching costs were simply too high. Despite high interest rates, Buyers’ home buying needs continued as they needed to buy homes for their families. Buyers quickly realized that inventory levels were extremely low, which forced them into bidding situations once again. Economically we made excellent progress on inflation, bringing the rate down from 6% to 3.1%. Economists project that the Federal Reserve will drop rates in Q3 of 2024 and will likely hold steady for Q1 and Q2 of 2024. In anticipation of this, in December lenders lowered the mortgage interest rates to the lower 6% range. The NASDAQ gained 43% in 2023 which is great news for Silicon Valley tech buyers whose down payments and wealth are heavily tied to their employee stock plans. Layoffs have continued but have held steady overall and not in large numbers.</span></p><p><span face="Calibri, sans-serif" style="text-indent: 0.5in;">We anticipate 2024 to be a low inventory Sellers’ market this year. Those of you that were buying in 2023, we often asked ourselves the question, “what happens if rates dropped can you imagine the competition then?” In 2024, Buyers will be running into increased levels competition due to these lower rates and positive health of stock portfolios, paired with the economy trending in the positive direction is going to create fierce bidding wars. The hope is that the lower rates will encourage Sellers to move out of their homes so that Buyers have more inventory, but that is never guaranteed in the traditionally inventory stricken high demand area that we live in.</span></p><p><span face="Calibri, sans-serif" style="text-indent: 0.5in;">If you are a Seller, 2024 is going to be an even better year for selling real estate depending on where your home is located. As a Buyer, be ready for fierce competition as the lower rates increases the buying your power dramatically as well as that of your competitors. Every market and home type is different so do reach out to us for a more specific analysis of your home. Reach out to us through a direct message or email</span><span face="Calibri, sans-serif" style="text-indent: 0.5in;"> </span><a href="mailto:alan@alanwangrealty.com" style="color: #954f72; font-family: Calibri, sans-serif; text-indent: 0.5in;">alan@alanwangrealty.com</a><span face="Calibri, sans-serif" style="text-indent: 0.5in;"> text or call (408)313-4352 for a personal consultation. Have a great start to 2024!</span></p><p><span face="Calibri, sans-serif" style="text-indent: 0.5in;">Feeling Social? - Engage with us on Linkedin </span><a href="https://www.linkedin.com/pulse/2023-silicon-valley-real-estate-year-in-review-2024-outlook-alan-wang-389ec%3FtrackingId=Q5hz4PJ9FvBzJpxux6e4AQ%253D%253D/?trackingId=Q5hz4PJ9FvBzJpxux6e4AQ%3D%3D">https://www.linkedin.com/pulse/2023-silicon-valley-real-estate-year-in-review-2024-outlook-alan-wang-389ec%3FtrackingId=Q5hz4PJ9FvBzJpxux6e4AQ%253D%253D/?trackingId=Q5hz4PJ9FvBzJpxux6e4AQ%3D%3D</a></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-indent: 0.5in;"><o:p></o:p></p>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6677356073587079062.post-15446573861691298832023-09-20T23:28:00.003-07:002023-09-20T23:29:44.801-07:00September 2023 Silicon Valley Real Estate Update<p style="text-align: left;"> <span style="text-align: center;"><span face="Helvetica Neue, Helvetica, Arial, Verdana, sans-serif"><span style="white-space: pre-wrap;">2023 has been a strong Sellers’ market year to date. Sellers have been holding onto their record low interest rates and unwilling to sell. Despite higher interest rates (6% to 6.5%), the low supply has brought the return of multiple offers on properties. Cash offers are abundant once again. However, we seem to be possibly entering into our seasonally slower season. Last weekend, open houses were slow for the first time all year. We are heading into that fall season and it is not uncommon to see a drop-off in activity as we head into the holidays.</span></span></span></p><p style="text-align: left;"><strong>Federal Reserve</strong></p><p style="text-align: left;">The Federal Reserve decided to hold rates steady, yet leaving a window open for another rate hike this year. They want to make sure that inflation rates are under control and we don’t see them loosening quickly but slowly in the next year or two.</p><p style="text-align: left;"><strong>Seller Advice</strong></p><p style="text-align: left;">As a Seller, the market is currently in your favor if you are looking to sell. Depending on your urgency, we should try to avoid the holiday season and plan for the spring market instead. Reach out to us for a direct analysis on your families situation.</p><p style="text-align: left;"><strong>Buyer Advice</strong></p><p style="text-align: left;">Many of our Buyers have been offering and winning properties. Competition is there but not as fierce as it was during the pandemic. Some of you have expressed the desire to take the wait and see approach or frustrated with the low inventory. We certainly cannot control the inventory, but we certainly can control our mindsets. The market is competitive, there is no question, however imagine what will happen if the interest start to trend downwards. Suddenly Buyers can afford a higher home price and an even more aggressive bidding war emerges. Todays overbid could be tomorrows bargain and this is seen in our market year in and year out. As a Buyer take advantage of the upcoming slower season and be ready to move if you see an opportunity. People that succeed do not do so by following the crowd, be aggressive while others are on break before the next wave hits!</p><p style="text-align: left;"><strong>Thank You All For Your Support!</strong></p><p style="text-align: left;">Despite a tough year in our industry due to low inventory, each and everyone of you continue to partner with us for your real estate needs. You continue to entrust us with your friends and family. We continually thank you for trusting us and we will always continue to elevate our expertise and level of service. Have a happy September!</p>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6677356073587079062.post-35020790760889708772023-04-05T14:20:00.000-07:002023-04-05T14:20:16.909-07:00Q1 2023 Silicon Valley Real Estate Update<p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: left;">As we conclude the first quarter of 2023, the Silicon Valley real estate market continues to experience a roller coaster of activity on macro and micro economic levels. Overall, the real estate market is recovering in 2023. After putting their real estate needs on hold from May to December of 2022, Buyers realized that life events continue, and real estate purchases could not be put on hold any longer. They accepted the new interest rate environment and entered back into the marketplace.</p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Silicon Valley Bank Collapse<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">One recurring question has been around the collapse of Silicon Valley Bank. We have not seen any significant impact to residential real estate, with companies' payrolls and funds being guaranteed by the government. This was a prudent move by our government to instill confidence in our banking system. In short, there is nothing to see here carry on.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Tale of Two Market Continues<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The market continues to be divided into two distinct categories. The first prime market of homes with highly desirable criteria, are selling quickly with multiple offers once again. The criteria include good schools, excellent locations, or affordable price points. In contrast, the second market is a bit slower in some markets or property types, with factors such as above market Seller expectations, not a strong school district, or a less central location have all contributed to sluggish sales in this sector.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>General Trends<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Looking at general trends, prime markets are once again seeing multiple offers. For example, a tear-down property in Saratoga off the market received nine offers, a Sunnyvale single-family home with good schools attracted five offers and a townhome in Los Gatos has 11 offers. The second market sector saw fewer offers, such as a San Mateo townhome after long days on market received 2 offers after a price drop and a Sunnyvale single-family home that was pulled off the market without receiving any offers. Overall, the Silicon Valley real estate market is still competitive, and homes that meet the right criteria are receiving multiple offers. However, sellers need to be mindful of pricing their homes to the market value to ensure that they achieve the best possible outcome in this market. Buyers are pickier than during the COVID years. We will continue to monitor the market trends and provide updates as they emerge throughout the year.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>NASDAQ<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The technology heavy NASDAQ was down 33.8% in 2022. This wiped out the 23% of stock market gains in 2021, but there is good news. As of 4/3/2023, the NASDAQ has recovered 17.7% making this a net 7% recovery since the COVID year. This is better news and could explain why Buyers are back in the market with a little bit more down payment.<sub><o:p></o:p></sub></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 1 – Nasdaq Composite 2023 Snapshot<o:p></o:p></b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjhqzy7sbPnTHlpa36clY8VDmCPTrkWvxCFZ-aC4X_AmJDdAUUj8NxP9VfYj776TNnYyirUMVMIebtRPGYVniNv3WQdCAZyb86Bs70wBE_KNN9siDCe2P6NBrQE-y7g6tzMwfC9TxnVCP3INYlpedYZBxfjg8S-2s7u2MDy0nwyEBXfQcoqSL6ZhIfJ6A/s936/Exhibit%201.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="710" data-original-width="936" height="486" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjhqzy7sbPnTHlpa36clY8VDmCPTrkWvxCFZ-aC4X_AmJDdAUUj8NxP9VfYj776TNnYyirUMVMIebtRPGYVniNv3WQdCAZyb86Bs70wBE_KNN9siDCe2P6NBrQE-y7g6tzMwfC9TxnVCP3INYlpedYZBxfjg8S-2s7u2MDy0nwyEBXfQcoqSL6ZhIfJ6A/w640-h486/Exhibit%201.png" width="640" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source - Yahoo! Finance</i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Mortgage Interest Rates</b><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">In 2023, Buyers got accustomed to the interest rates and loan programs have gotten a little more advantageous for Buyers. Rates have dropped slightly but continue to hold above the record lows prior.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 2 – 30 Year Fixed Mortgage Rate<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjgLJbCmk4Clw0JWPEToFNBbsodk6huVTI7SGx_IRUXmqLfdN-2nvvvseqzctKsJtqKohBZTo7XsjQOZp0l4PQ1UtNQ1RIx-gT1AeeTCK0qyyVorKMzm7IN3akcpnx-BW5g0j81LHlUJBMOG5kxII0nUiJD5kCEkV2j99UG9usRDIQw-A2tjAh5VjZWWQ/s936/Exhibit%202.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="282" data-original-width="936" height="192" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjgLJbCmk4Clw0JWPEToFNBbsodk6huVTI7SGx_IRUXmqLfdN-2nvvvseqzctKsJtqKohBZTo7XsjQOZp0l4PQ1UtNQ1RIx-gT1AeeTCK0qyyVorKMzm7IN3akcpnx-BW5g0j81LHlUJBMOG5kxII0nUiJD5kCEkV2j99UG9usRDIQw-A2tjAh5VjZWWQ/w640-h192/Exhibit%202.png" width="640" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – St Louis Federal Reserve</i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i> </i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Here is a sample of local rates which are lower than the national average especially on jumbo loans.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 3 – Local Wells Fargo Mortgage Rate<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i><br /></i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b></b></p><div class="separator" style="clear: both; text-align: center;"><b><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEitpdarFKuGhEmfHVTq6RE9nbmRTePVaywm17g8CRwsdX7NBCFOMbub3hXm7mUgEpuq5-wCPucqnpFn7ci2-S1omf3xjPD-mJaI0YdQXpdfk45hZfXUL_n_5T7ZKx7Ticpsg_TU09-wf3hADtgEh79xw2PCmOvrg2KpyX-l_RQrKCIYcjvgidRzwLVbTQ/s936/Exhibit%203.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="790" data-original-width="936" height="541" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEitpdarFKuGhEmfHVTq6RE9nbmRTePVaywm17g8CRwsdX7NBCFOMbub3hXm7mUgEpuq5-wCPucqnpFn7ci2-S1omf3xjPD-mJaI0YdQXpdfk45hZfXUL_n_5T7ZKx7Ticpsg_TU09-wf3hADtgEh79xw2PCmOvrg2KpyX-l_RQrKCIYcjvgidRzwLVbTQ/w640-h541/Exhibit%203.png" width="640" /></a></b></div><p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source - Wells Fargo Private Mortgage<o:p></o:p></i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Inflation</b><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The rate increases are having an effect. Inflation rates have gone from 9.1% to 6%. We are trending in the right direction, but we still have ways to go to get to the 2% to 3% range.<o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 4 – 12 Month Inflation Percentage</b><o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b></b></p><div class="separator" style="clear: both; text-align: center;"><b><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRsyp5BP7CoE3iB758CdhyYjJJr7Qf7FuPaKqkl1X_DzACKgCRyGYrLQPeLUfDRYfVXo1u6Mjr9y6KbHtQdmmRtMpXqbxnxgacLBKFH4uQj_FXDj0dUWz5W7lvZp2xbhGVuJJhTUDe09eS0ydxfrDJpa6hVKoSCJ_Hor_jycVzLxC8ZTXYKlzq2x-CKA/s936/Exhibit%204.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="694" data-original-width="936" height="474" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiRsyp5BP7CoE3iB758CdhyYjJJr7Qf7FuPaKqkl1X_DzACKgCRyGYrLQPeLUfDRYfVXo1u6Mjr9y6KbHtQdmmRtMpXqbxnxgacLBKFH4uQj_FXDj0dUWz5W7lvZp2xbhGVuJJhTUDe09eS0ydxfrDJpa6hVKoSCJ_Hor_jycVzLxC8ZTXYKlzq2x-CKA/w640-h474/Exhibit%204.png" width="640" /></a></b></div><b><i>Source – US Bureau of Labor Statistics</i></b><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Layoffs in the Technology Sector<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Layoffs continue in the tech sector almost weekly. Tech employees are getting a good amount of runway as far as severance pay, so the impact may not reveal itself until Q3 or Q4 of 2023. Most companies are on hiring freezes and there are a lot of candidates looking for work. Although not ideal, there are consulting jobs available at a worst case, that could prevent this from becoming a broader issue for our local economy. We will have to monitor the impact if any to residential real estate.<o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 5 – Technology Layoffs<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b></b></p><div class="separator" style="clear: both; text-align: center;"><b><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg4FiBl-yOqJZGLYwgb1LAxoZyTdY6Ffs_ocAi7bNG8Tz2bQmkCC5VTLfR-EE-XH0Ejda6Pkx8P-g9Vsn_-r_mzW_7242t-4SpVJxv_5p6GByjCs7g-BRHhhAFGjvtDMcR_9MTnvciIHIFMDfHwcE8vl1880lRkxMHbZfdxZM8BDVgel-1xYK-WtvbueQ/s936/Exhibit%205.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="416" data-original-width="936" height="285" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg4FiBl-yOqJZGLYwgb1LAxoZyTdY6Ffs_ocAi7bNG8Tz2bQmkCC5VTLfR-EE-XH0Ejda6Pkx8P-g9Vsn_-r_mzW_7242t-4SpVJxv_5p6GByjCs7g-BRHhhAFGjvtDMcR_9MTnvciIHIFMDfHwcE8vl1880lRkxMHbZfdxZM8BDVgel-1xYK-WtvbueQ/w640-h285/Exhibit%205.png" width="640" /></a></b></div><p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – True Up Tech<o:p></o:p></i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Unemployment<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The unemployment rate has increased slightly from 4.1% to 4.3%. Again, something to monitor with the tech layoffs.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 6 – California Unemployment Rate<o:p></o:p></b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiM4a4GRxV9fCxFrHVJVKelerB4xX26fSNpnij9NMBq0zAh5_9gqCbj21xQ1PnaH4s8FGZoJkLkKtiXGmVYcXyMdxy9uhh_N4MIfH2FVpzRsdfvszGYuWd33Ge0GrOBGxP22WI4-6ykKcckdvhBCT-3XqyJLyDBjJwFEXLQgQJz4TDZN3-pXOGeXF8Z-w/s936/Exhibit%206.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="634" data-original-width="936" height="434" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiM4a4GRxV9fCxFrHVJVKelerB4xX26fSNpnij9NMBq0zAh5_9gqCbj21xQ1PnaH4s8FGZoJkLkKtiXGmVYcXyMdxy9uhh_N4MIfH2FVpzRsdfvszGYuWd33Ge0GrOBGxP22WI4-6ykKcckdvhBCT-3XqyJLyDBjJwFEXLQgQJz4TDZN3-pXOGeXF8Z-w/w640-h434/Exhibit%206.png" width="640" /></a></div><br /><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – Bureau of Labor<o:p></o:p></i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Real Estate Outlook<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">2023 kicked off with a strong start for most Sellers. Inventory has remained low, and this market has always been on the cusp of shifting to a Sellers’ market. As a Seller if you one universal fact remains, every home has a sweet spot, and if priced correctly, the property will sell. The question then becomes whether sellers are willing to price their home in line with market's expectations and take an offer in that price range. If you have been thinking about selling, look at the price recovery and see if that is an acceptable net amount for you to proceed with a sale. If not continue to hold until the market turns further to that acceptable price point.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">As a Buyer, if you did not buy last year, you missed the bottom. However, do not fear, the market is coming off the bottom and recovering. Without a crystal ball it is difficult to perfectly time the market, but rest knowing that the market is recovering from the bottom, and it is still a great time to buy. Be ready to compete though not as aggressively as during COVID. Remember real estate is a long-term investment and best to own Silicon Valley real estate instead of renting and missing out on the upside when the market turns once again.<o:p></o:p></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><strong><span face="Calibri, sans-serif">Schedule Your Custom Real Estate Strategy Consultation Meeting</span></strong><span face="Calibri, sans-serif"><o:p></o:p></span></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><span face="Calibri, sans-serif">Everyone family has a unique real estate scenario specific to their needs and circumstances. We are always available to have a strategic consultation meeting with you to address your needs and come up with an execution plan. Book your consultation with us today at </span><b style="color: #954f72;"><span face="Calibri, sans-serif"><a href="mailto:homes@alanwangrealty.com" target="_blank">homes@alanwangrealty.com</a></span></b><span class="apple-converted-space"><span face="Calibri, sans-serif"> </span></span><span face="Calibri, sans-serif">or call and text us at (408)313-4352.<o:p></o:p></span></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><b><span face="Calibri, sans-serif">Feeling Social?<o:p></o:p></span></b></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><span face="Calibri, sans-serif">Join the Conversation on Linkedin! - </span><a href="https://www.linkedin.com/pulse/2023-q1-silicon-valley-real-estate-update-alan-wang/" target="_blank">https://www.linkedin.com/pulse/2023-q1-silicon-valley-real-estate-update-alan-wang/</a></p>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6677356073587079062.post-25567032227365608672023-01-03T18:00:00.002-08:002023-01-04T23:24:22.803-08:00 2022 Silicon Valley Real Estate Year in Review and 2023 Outlook<p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Turbulence would be an understatement for how the real estate market fared since the beginning of the COVID-19 pandemic. When the pandemic locked us in our homes, there was widespread fear of how our lives, our health and our jobs would be affected. The stock market dropped in value and the housing market froze.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Then in a blink of an eye, the stock market turned upward, especially companies in the technology sector. Technology was heavily relied upon to navigate through the pandemic which is why these companies saw enormous growth. Technology stocks soared by over 23% and thereby increased the wealth of Silicon Valley workers. The Federal Reserve acted quickly and dropped interest rates. Mortgage interest rates were once again at all-time lows. Two factors also became critical; families needed more space specifically bedrooms and more yard space. Paired with increased wealth for down payments and loans at bargain rates, Buyers came out in droves to purchase the home that their families desperately needed. In an area with traditionally low inventory, this spike in demand caused an aggressive level of bidding that we have not seen in our 19+ years in the business.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">As we emerged from the pandemic, another phenomenon occurred that our economists did not factor into their stimulus. Families working at home cut their spending significantly. Consumer spending dropped as we were trapped in our homes; the byproduct is that our savings increased dramatically. As we emerged from the pandemic and were allowed to dine, enjoy entertainment, and even simply drive again, our pent-up demand exploded across all products lines. There was only one problem, companies did not predict this surge of demand and they not only scaled back production during the pandemic, but COVID affected the ability of their workforces to be at maximum efficiency hence a lower supply of products were produced. Low supply and high demand equated to higher prices. Unfortunately, we over stimulated the economy to which prices soared to over 9% due to this dynamic.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">At the start of 2022 we were in for a rude awakening. What goes up must come down. Inflation was the theme of the year as our country has been fighting the higher prices by aggressively raising interest rates. This has had a major impact on the prices of Silicon Valley real estate. Prices peaked in April and real estate prices have been on a downward trend since.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>NASDAQ<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The technology heavy NASDAQ is down 33.8% in 2022. This not only wiped out the 23% of stock market gains in 2021, but we are taking an additional 10.8% loss on top of that. This has directly affected the amount that Buyers are able to put down on their next homes. This is a major contributor to the current real estate market.<o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 1 – Nasdaq Composite 2021<o:p></o:p></b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiVlA73_29K-FMdh5xW5ATxJ9sMaamycTvYVcUpzw_HYywqYMg_sDMg427RO9er0rSh_ci-exIKOBMieXYBsJsfYgkmWlJf9A26OTeNbrqkYqZ0hl275d-7lbvOK0phHhqDDqT_cKlOJUmvYayPEf7gs0fFs2bcdpTKN83QBQsZOukZ3WjhqR_QfEeIzg/s936/Exhibit%201%20Nasdaq%202021.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="580" data-original-width="936" height="248" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiVlA73_29K-FMdh5xW5ATxJ9sMaamycTvYVcUpzw_HYywqYMg_sDMg427RO9er0rSh_ci-exIKOBMieXYBsJsfYgkmWlJf9A26OTeNbrqkYqZ0hl275d-7lbvOK0phHhqDDqT_cKlOJUmvYayPEf7gs0fFs2bcdpTKN83QBQsZOukZ3WjhqR_QfEeIzg/w400-h248/Exhibit%201%20Nasdaq%202021.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source Yahoo! Finance<o:p></o:p></i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Mortgage Interest Rates</b><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Our Federal Reserve recognized that they overstimulated the economy and had to aggressively raise interest rates to get inflation under control. This more than doubled the cost to borrow and increased monthly payments dramatically. Cheap money was gone, and Buyers had to quickly adapt to the new reality. Many Buyers moved to the sidelines and continue to wait.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 2 – 30 Year Fixed Mortgage Rate<o:p></o:p></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUYjpZXZCghOOzUXLAq-CV7bF0Xii764_--Lx6rz5X9C7DOdTLZ2GEUJEcwPe3G2ZG5FfG4S4bA_jap63HJhsJLt3h-sKXZ9yfbwo6TY3O-hSP7iCzbcW6_I-BcHQejE1NRYc6JuXgzjGSv7GizXIjM1AUANNlGNFKVZFDLCWaDc0VAJp7rjK_aJE33w/s936/Exhibit%202%20%E2%80%93%2030%20Year%20Fixed%20Mortgage%20Rate.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="346" data-original-width="936" height="148" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUYjpZXZCghOOzUXLAq-CV7bF0Xii764_--Lx6rz5X9C7DOdTLZ2GEUJEcwPe3G2ZG5FfG4S4bA_jap63HJhsJLt3h-sKXZ9yfbwo6TY3O-hSP7iCzbcW6_I-BcHQejE1NRYc6JuXgzjGSv7GizXIjM1AUANNlGNFKVZFDLCWaDc0VAJp7rjK_aJE33w/w400-h148/Exhibit%202%20%E2%80%93%2030%20Year%20Fixed%20Mortgage%20Rate.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – St Louis Federal Reserve<o:p></o:p></i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Inflation</b><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Despite all the bad news there is some good news. These aggressive increases in the prime rate seem to be having an effect. Inflation peaked at 9.1% and is trending downward to 7.1% in November. The Federal Reserve did not go as aggressive of late, opting for a half point hike rather than the three-quarter hikes they have been doing much of this year. We are seeing gas prices come down lower as an example. Hopefully this trend continues.<o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 3 – 12 Month Inflation Percentage</b><o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhEAUzX62NiYgNlllSZ7k_vNSP0-O0LaPvTH5-Gc8dol8nIpvKRVnCq6S03YkoxDt5JkDp2AAcnCMW6Je9wPztJd_fK77Fg3PM6BXq-qCchD-rZQCrIMvM3nnKkH8UC2I_eGCE_1WhxRCCPMCeT8Qgfbk3U24UObDgWmIT-HC-Y4iMhjMsIBAxwLGruXg/s936/Exhibit%203%20%E2%80%93%2012%20Month%20Inflation%20Percentage.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="700" data-original-width="936" height="299" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhEAUzX62NiYgNlllSZ7k_vNSP0-O0LaPvTH5-Gc8dol8nIpvKRVnCq6S03YkoxDt5JkDp2AAcnCMW6Je9wPztJd_fK77Fg3PM6BXq-qCchD-rZQCrIMvM3nnKkH8UC2I_eGCE_1WhxRCCPMCeT8Qgfbk3U24UObDgWmIT-HC-Y4iMhjMsIBAxwLGruXg/w400-h299/Exhibit%203%20%E2%80%93%2012%20Month%20Inflation%20Percentage.jpg" width="400" /></a><b style="font-family: Calibri, sans-serif;"><i> </i></b></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – US Bureau of Labor Statistics</i></b><b><i><o:p></o:p></i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Layoffs in the Technology Sector<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Ever concerning are the layoffs in the technology sector. Although not all jobs are in the Silicon Valley, a larger amount of the technology jobs are centralized here. This new factor has caused much fear in Silicon Valley home Buyers. If this trend continues, it will add to an already nervous sector of Buyers. Hopefully there are no more layoffs occurring in 2023.<o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Exhibit 4 – Technology Layoffs<o:p></o:p></b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi02vpCPeXVJfeDgcWhYYPkbD680zaO7CDjN4s3UGUYfvqqSc12VZ2Vp7DCA2ag3krN5BFGxlWQkS19kQlvLmL9gCBDA_b4L-j4iiD6xxkDkelcm11O0Cavkox4tXKLQO67HHKErtkOmmtmnMHPWia8tdrsPkMRgLLzW9tzfMa0dP6XSK0uPPeNEFTkdw/s936/Exhibit%204%20%E2%80%93%20Technology%20Layoffs.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="576" data-original-width="936" height="246" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi02vpCPeXVJfeDgcWhYYPkbD680zaO7CDjN4s3UGUYfvqqSc12VZ2Vp7DCA2ag3krN5BFGxlWQkS19kQlvLmL9gCBDA_b4L-j4iiD6xxkDkelcm11O0Cavkox4tXKLQO67HHKErtkOmmtmnMHPWia8tdrsPkMRgLLzW9tzfMa0dP6XSK0uPPeNEFTkdw/w400-h246/Exhibit%204%20%E2%80%93%20Technology%20Layoffs.jpg" width="400" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – Trup Up Tech<o:p></o:p></i></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Unemployment<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Despite the layoffs, for now the unemployment rate remains at 4.1%. It might take a few more months for this data to settle to determine if the Technology layoffs had any affect.<o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgCSmRCrQRiO5wADvbGgC0RJXfGJcjs3lxCjdG6geE6DEQkLNqSJmp5Fk1XZtucdrTxiTLMTg4CD6WZ8FWnSrytzsNSjDw1RB6a4fPBFXRcrml4OtQaXjDsFrCb6wIElDE87j3Az7oO-pkj0Ve1Ga8MQaD1EvpX-77XPqedsc6_QPfvnXuT5fzastwAnA/s936/Exhibit%205%20-%20CA%20Unemployment.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="884" data-original-width="936" height="302" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgCSmRCrQRiO5wADvbGgC0RJXfGJcjs3lxCjdG6geE6DEQkLNqSJmp5Fk1XZtucdrTxiTLMTg4CD6WZ8FWnSrytzsNSjDw1RB6a4fPBFXRcrml4OtQaXjDsFrCb6wIElDE87j3Az7oO-pkj0Ve1Ga8MQaD1EvpX-77XPqedsc6_QPfvnXuT5fzastwAnA/s320/Exhibit%205%20-%20CA%20Unemployment.png" width="320" /></a></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><i>Source – Bureau of Labor<o:p></o:p></i></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>2023 Real Estate Outlook<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">If we are optimistic perhaps the market turns in the next 2 quarters, however realistically we could be in this down market for most of next year. The critical factor to note is that inventory levels are still low. Our clients who are looking for homes, often complain that they are not pleased with the inventory available. It would not take much of a surge in demand to turn the market back into an aggressive Sellers’ market once again. For now, all of the leading economic factors seem to be pitted against a turnaround in the current market.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">For our Buyers, the question is always when we will the market bottom as far as prices and when is the best time to buy. We never know when the bottom is and once we do it has passed us already. The real questions are do you have a family need and is this a long-term purchase? If the answer is yes to both of these questions, then it is a good time to buy. For those of you that are speculating, remember that when the market turns it turns quickly and with the market down 15% to 20% it is not a bad time to get in.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">For our Sellers, the question is always is it a good time to sell? The key questions are do you have a family need to sell and do have you made a good amount of equity? If the answer is yes to both of these questions, then yes, it is a good time to sell. If not perhaps you can wait out 2023 for a better market in 2024. The questions is how much further could this market go in 2023? Should we take our gains off the table now or can we wait longer for the market to recover?<b><o:p></o:p></b></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><strong><span face="Calibri, sans-serif">Schedule Your Custom Real Estate Strategy Consultation Meeting</span></strong><span face="Calibri, sans-serif"><o:p></o:p></span></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><span face="Calibri, sans-serif">Everyone family has a unique real estate scenario specific to their needs and circumstances. We are always available to have a strategic consultation meeting with you to address your needs and come up with an execution plan. Book your consultation with us today at </span><a href="http://mailto:homes@alanwangrealty.com/" style="color: #954f72;" target="_blank"><b><span face="Calibri, sans-serif">homes@alanwangrealty.com</span></b></a><span class="apple-converted-space"><span face="Calibri, sans-serif"> </span></span><span face="Calibri, sans-serif">or call and text us at (408)313-4352.<o:p></o:p></span></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><span face="Calibri, sans-serif">Wishing you and your families an amazing 2023!<o:p></o:p></span></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><b><span face="Calibri, sans-serif">Feeling Social?<o:p></o:p></span></b></p><p style="font-family: "Times New Roman", serif; margin-left: 0in; margin-right: 0in;"><span face="Calibri, sans-serif">Join the Conversation on Linkedin! <a href="https://www.linkedin.com/pulse/2022-silicon-valley-real-estate-update-2023-outlook--1c/" style="color: #954f72;">https://www.linkedin.com/pulse/2022-silicon-valley-real-estate-update-2023-outlook--1c/</a></span><span style="font-family: Calibri, sans-serif;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6677356073587079062.post-2460189270310315952022-10-05T10:12:00.005-07:002022-10-05T10:12:23.129-07:00October 2022 Silicon Valley Real Estate Update<p>The real estate market continues to be volatile. In an effort to battle inflation, rising interest rates are having a direct impact on both real estate and stock markets. Silicon Valley Buyers are battered by higher monthly payments (due to rising interest rates), lower down payments (due to reduced stock portfolios) which result in lower pre-approval purchase prices.</p>We are finding that Buyers are simply unable to afford the prices being offered by Sellers forcing them to negotiate. With these factors at play, Sellers that are selling are struggling to find the right equilibrium price that Buyers are able to transact, as the market that continues to trend downward.<div><br />We are pleased to have the opportunity to help our Buyers secure excellent homes at great prices. Buyers should also realize that this interest rate environment is short term. Once inflation is under control, the Federal Reserve should lower rates and that would be a great time to refinance.<br /><br />Sellers who have to sell now, will have to contend with the fact that the offer prices the market is offering will be lower than the peak Spring prices and will continue to trend downward in the short term. If there is no urgency to sell, many have opted to not sell or rent out their homes as we get through this inflationary period. Some Sellers are opting to take the gains that they can, in order to get a good price on the buy side as well.<br /><br />Inventory is still at all time lows, however our inflationary circumstance is forcing monetary policy to suppress the key factors that typically fuel real estate, causing downward pressure on home prices in the short term. The hope is that we get inflation under control soon so that monetary policy can be relaxed so that the real estate market can stabilize.</div>Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-6677356073587079062.post-28166657676452987752022-08-15T12:15:00.009-07:002022-08-16T13:27:49.966-07:00August 2022 Silicon Valley Real Estate Update – A Frozen Market That Could be Thawing <div class="separator" style="clear: both; text-align: center;"><iframe allowfullscreen="" class="BLOG_video_class" height="266" src="https://www.youtube.com/embed/VYY8hDw4YCU" width="320" youtube-src-id="VYY8hDw4YCU"></iframe></div><div><span style="font-family: arial;"><br /></span></div><div><span style="font-family: arial;">It has certainly been an eventful or shall I say uneventful summer. The market peaked in May and Buyers have been waiting on the sidelines as interest rates rose multiple times this year and the stock market continued to fizzle in June. Buyers were and continue to be concerned about a recession. In addition, more families were on holiday than prior years; this has been the first travel window for families in over 2 years since COVID grounded us all.</span></div><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">Panicked Sellers who missed the bull market, rushed to put their homes on the market, tried to stay ahead of rate hikes, all of which were futile as Buyers were already sidelined. Buyers that were in the market, were often embarrassed by their offers and didn’t even want to write them as they were wishful lowball offers. The beginning of July was much the same.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">However, in the last week of July, activity started to pick up in the marketplace albeit still slowly. Contrary to the news, interest rates have in fact dipped under 5% and hovering in the low 4% range. Due to low demand, banks have pivoted to provide more attractive rates and more relevant loan programs for Buyers. Homes have started get into contract, but with an over 10% adjustment and more in some areas. For most homes on the market, after one or two price adjustments, Buyers who sent offers that were serviceable to a Seller, were able to get into contract with generous terms and pricing. In the last 3 weeks we have seen more Buyers engaging and looking around. Most Buyers are still in deal hunting mode, but more are coming off the sidelines. It is too soon to say there is any trend or recovery, just an observation at this juncture.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><b><span style="color: #222222; font-family: arial;">Inflation Rates<o:p></o:p></span></b></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"> </span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;">Inflation peaked at 9.1% in July, but recently retreated to 8.5%, which is hopefully a sign of more stabilization to come. Unfortunately, the Federal Reserve will continue to increase interest rates until this is under control which will impact mortgage rates.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><span style="font-family: arial; margin-left: 1em; margin-right: 1em;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrWVaEECde6EFVB2B8G-ZUwyvANmFmYJP4zRfYH_gmvFsKNxVYltfFZohvM-YNKrJIvdPce1vWkARVqWK5I6u7mXIwxN1CRLGzGtqHQ__w7PACcGL93ayCu-z2QnoCB5yvnZPX307ILzZD2adRN6MvtzZW2J_q9rsvh7VN2YmCNI6medafqy_Z0frXng/s468/Picture1.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="389" data-original-width="468" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrWVaEECde6EFVB2B8G-ZUwyvANmFmYJP4zRfYH_gmvFsKNxVYltfFZohvM-YNKrJIvdPce1vWkARVqWK5I6u7mXIwxN1CRLGzGtqHQ__w7PACcGL93ayCu-z2QnoCB5yvnZPX307ILzZD2adRN6MvtzZW2J_q9rsvh7VN2YmCNI6medafqy_Z0frXng/s16000/Picture1.jpg" /></a></span><span style="color: #222222; font-family: arial; text-align: left;"> </span></div><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="font-family: arial;"><span style="color: #222222;"><v:shapetype coordsize="21600,21600" filled="f" id="_x0000_t75" o:preferrelative="t" o:spt="75" path="m@4@5l@4@11@9@11@9@5xe" stroked="f"><v:stroke joinstyle="miter"><v:formulas><v:f eqn="if lineDrawn pixelLineWidth 0"><v:f eqn="sum @0 1 0"><v:f eqn="sum 0 0 @1"><v:f eqn="prod @2 1 2"><v:f eqn="prod @3 21600 pixelWidth"><v:f eqn="prod @3 21600 pixelHeight"><v:f eqn="sum @0 0 1"><v:f eqn="prod @6 1 2"><v:f eqn="prod @7 21600 pixelWidth"><v:f eqn="sum @8 21600 0"><v:f eqn="prod @7 21600 pixelHeight"><v:f eqn="sum @10 21600 0"></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:formulas><v:path gradientshapeok="t" o:connecttype="rect" o:extrusionok="f"><o:lock aspectratio="t" v:ext="edit"></o:lock></v:path></v:stroke></v:shapetype><v:shape alt="Graphical user interface, chart
Description automatically generated" id="_x0000_i1029" style="height: 389pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Graphical user interface, chart
Description automatically generated" src="file:////Users/alanwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image001.png"></v:imagedata></v:shape></span><span style="color: #222222;"><o:p></o:p></span></span></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="color: #222222; font-family: arial;">Source – US Bureau of Labor Statistics<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><b><span style="color: #222222; font-family: arial;"> </span></b></p><p class="MsoNormal" style="margin: 0in;"><b><span style="color: #222222; font-family: arial;">Interest Rates<o:p></o:p></span></b></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"> </span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;">Interest rates previously increased from 2.875% in January to over 5% in May on a 30-year fixed jumbo loan. The good news is that jumbo mortgage rates are currently in the low 4% range at the moment. Since demand disappeared for mortgages, banks are pivoting to get Buyers interested again. As we don’t expect inflation to run rampant in the long run, these rate hikes will likely be temporary. Different loan programs are being explored such as Adjustable-Rate Mortgages (ARM), longer loan vesting periods and even interest only loans. If we believe that mortgage rate increases are temporary, then all that matters to a Buyer is being able to handle their payments in the short run, then refinance to a better program when inflation is under control.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"> </span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;">Here are the nationwide 30-year fixed mortgage rates and also our local conventional and jumbo rates.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"> </span></p><p class="MsoNormal" style="margin: 0in;"><b><span style="color: #222222; font-family: arial;">30 Year Fixed Mortgage Average Rate<o:p></o:p></span></b></p><p class="MsoNormal" style="margin: 0in;"><b><span style="color: #222222; font-family: arial;"><br /></span></b></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><b></b></span></p><div class="separator" style="clear: both; text-align: center;"><b><span style="font-family: arial; margin-left: 1em; margin-right: 1em;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEilWnXEEeda2zRC2goFBkG9OBDV6R3dB53qAmCJ0kn_-p3fpPPb3LIXbbCK-zczWhbS9eLt4fqwb35nQ-L_eOp36rD9DC60e-XF4GLiCVNB1cms4qI4ZZBsCikPufGZvYrBzZFxMKDGlQeKgu4NlBkBOJF4t9KyDLyCggc_pGZhrre9lgqOJvIIkFtsRA/s936/Picture2.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="646" data-original-width="936" height="276" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEilWnXEEeda2zRC2goFBkG9OBDV6R3dB53qAmCJ0kn_-p3fpPPb3LIXbbCK-zczWhbS9eLt4fqwb35nQ-L_eOp36rD9DC60e-XF4GLiCVNB1cms4qI4ZZBsCikPufGZvYrBzZFxMKDGlQeKgu4NlBkBOJF4t9KyDLyCggc_pGZhrre9lgqOJvIIkFtsRA/w400-h276/Picture2.jpg" width="400" /></a></span></b></div><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="color: #222222; font-family: arial;">Source - St Louis Federal Reserve<o:p></o:p></span></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="color: #222222; font-family: arial;"> </span></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><b><span style="color: #222222; font-family: arial;">Snapshot of Wells Fargo Home Mortgage Rates</span></b></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"></p><div class="separator" style="clear: both; font-weight: bold; text-align: center;"><span style="font-family: arial; margin-left: 1em; margin-right: 1em;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrzP-QNnlogojIpazc4Y863IQe-B72UA78A_yIjn5u7lzhjdMXHqut5k4Aic6zqyJJXpqUZt3ov4dSI67-97oJRlr2JUscGXwb4IETKS8Qi5NMI21lQtEPKo9aWZz72AV0-89KP3OGBoKebnzLBH7bn6AxLIQw1TZptFHcY7d-aqdu3f_Zrs7uFcMQ3Q/s468/Picture3.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="394" data-original-width="468" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjrzP-QNnlogojIpazc4Y863IQe-B72UA78A_yIjn5u7lzhjdMXHqut5k4Aic6zqyJJXpqUZt3ov4dSI67-97oJRlr2JUscGXwb4IETKS8Qi5NMI21lQtEPKo9aWZz72AV0-89KP3OGBoKebnzLBH7bn6AxLIQw1TZptFHcY7d-aqdu3f_Zrs7uFcMQ3Q/s16000/Picture3.jpg" /></a></span></div><span style="font-family: arial;"><div style="text-align: center;"><span style="color: #222222;">Source - Wells Fargo Home Mortgage</span></div></span><p></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="color: #222222; font-family: arial;"> </span></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><b><span style="color: #222222;">NASDAQ Index</span></b><span style="color: #222222;"><br /><br />The Technology heavy NASDAQ index has had solid gains towards the end of July and beginning of August, making a 4% recovery from the beginning of the year. We are currently down 20% from the peak of this year, verses 24% down back in May. That is good news for the down payment of our Silicon Valley home buyers but we still have a ways to go to have a substantial change in down payment for Silicon Valley homebuyers.<o:p></o:p></span></span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><span style="font-family: arial; margin-left: 1em; margin-right: 1em;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2pbWfZwjier6JMzknbAvU5UlLCL0zgAiWFr0Ku5bbhPWt0pecN4VwnD5pcpW8aPOfTRyyJD1QfiuPghYpTk-GZfRwiIE4mQ-IypzMftTqyTBJduqfQcsj1b4pwfJ6VqilP2lY2w8PESxsLKxIiB34rB2c1wEdlFssPSr8Pt4Ru0UcDRHfPF1f48TOKQ/s468/Picture4.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="333" data-original-width="468" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2pbWfZwjier6JMzknbAvU5UlLCL0zgAiWFr0Ku5bbhPWt0pecN4VwnD5pcpW8aPOfTRyyJD1QfiuPghYpTk-GZfRwiIE4mQ-IypzMftTqyTBJduqfQcsj1b4pwfJ6VqilP2lY2w8PESxsLKxIiB34rB2c1wEdlFssPSr8Pt4Ru0UcDRHfPF1f48TOKQ/s16000/Picture4.jpg" /></a></span></div><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><span style="color: #222222;"><v:shape alt="Chart, histogram
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In fact, we are having a hiring shortage in the valley. Finding a job is certainly not the issue.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><span style="color: #222222; font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><span style="font-family: arial; margin-left: 1em; margin-right: 1em;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEheBmgDWnRKOCycjeceARr6T6YS0Oz3M39mU-0BQz5z_ZcFQw9_pgNzgcf7jqJwb2dZvZdMpQBZKo5CzFV_Nwv6_3ENRw1vRIup7TsrSlb561R2SYIf3x9N4iF1xcrxeGAQiNRC_MWhmN9X0Gjg2A-SbYdLN1lAfzJ3ssflivghceUZe_Eof5ZSq9U87Q/s936/Picture5.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="606" data-original-width="936" height="259" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEheBmgDWnRKOCycjeceARr6T6YS0Oz3M39mU-0BQz5z_ZcFQw9_pgNzgcf7jqJwb2dZvZdMpQBZKo5CzFV_Nwv6_3ENRw1vRIup7TsrSlb561R2SYIf3x9N4iF1xcrxeGAQiNRC_MWhmN9X0Gjg2A-SbYdLN1lAfzJ3ssflivghceUZe_Eof5ZSq9U87Q/w400-h259/Picture5.png" width="400" /></a></span></div><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><span style="font-family: arial;"><a href="https://data.bls.gov/pdq/SurveyOutputServlet"><span style="color: #888888;">Source</span></a><u><span style="color: #888888;"> – US Bureau of Labor Statistics<o:p></o:p></span></u></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><b style="font-family: arial; text-align: center;">2022 Projections and Beyond</b></p><p align="center" class="MsoNormal" style="margin: 0in; text-align: center;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">Three weeks is too soon to say that we are in anything resembling a recovery. The market is frozen in many markets as Buyers are in the wait and see mode and slowly poking their heads out. The biggest question is that if the Federal Reserve continues to raise rates, will banks be able to keep the rate at an attractive enough level to have Buyers engaged in buying homes. The other two variables are the state of the inflation rate as well as the health of the NASDAQ.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">For Buyers, we advise that you get ahead of the market before things swing out of your favor. If this current trend holds, then the market could turn once again. Psychologically, humans seem to be programmed to move with the herd. When everyone is bidding hundreds of thousands over list price with no contingencies, Buyers feel that it is a great time to buy. When a Buyer could offer hundreds of thousand under list price with contingencies intact, they feel that it is a bad time to buy because no one else is buying and they are afraid to overpay in the moment. Savvy investors do not buy when everyone else is buying, they buy when no one else will. This is how wealth is created and opportunities capitalized upon, but only if we can overcome our fear of the unknown and the sense of security by following the herd.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">For Sellers, it is important to understand that this market is unpredictable but trending downward. Even with a 10%+ adjustment off peak prices in April and May, because the market has been frozen, Sellers have been dropping their prices to entice Buyers to transact. If you must sell now, be aware that we might be selling lower than we expected. We are looking for a reasonable Buyer who can get close to our first, second or even third list prices. If the prices we are getting do not match what we are looking for, then we need to decide if we need to proceed with other plans until this market gets more in our favor.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><o:p><span style="font-family: arial;"> </span></o:p></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">We don’t have a crystal ball and certainly the market continues to be fluid. From the current indicators, the market could be thawing a bit, but still frozen at the moment.<o:p></o:p></span></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"><b><span style="font-family: arial;">Feeling Social?</span></b></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">Join the Conversation on Linkedin!</span></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;"><br /></span></p><p class="MsoNormal" style="margin: 0in;"><span style="font-family: arial;">Call or Text Alan at (408)313-4352 or e-mail at <a href="mailto:alan@alanwangrealty.com">alan@alanwangrealty.com</a> for your customer real estate plan!</span></p>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6677356073587079062.post-86322612636069702182022-06-01T10:40:00.002-07:002022-06-01T10:40:24.472-07:00May 2022 Silicon Valley Real Estate Update – The Market Correction Has Arrived<p></p><div class="separator" style="clear: both; text-align: center;"><iframe allowfullscreen="" class="BLOG_video_class" height="383" src="https://www.youtube.com/embed/gA57nKD7Rsk" width="461" youtube-src-id="gA57nKD7Rsk"></iframe></div><span style="font-family: Calibri, sans-serif;"><p>As we were monitoring a few months back, the change in the market was not just a momentary blip, but a fundamental change in the market. Home prices peaked in March/April of 2022 and we are currently coming off peak as prices are leveling and seeing price adjustments in some areas. We are coming off peak prices. What does leveling mean?</p></span><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">We are not seeing the large quantity of offers pushing obscenely over list prices as we saw in the previous market. Homes with good locations, good schools and great condition are still selling. We are seeing less open house traffic along with the usual increase in summer inventory that is normal for this season. Homes will be on the market for weeks to maybe even a month as many Buyers seem to be in the wait and see mode. Inventory continues to be low but more competition is also sitting longer giving Buyers more options. If a home does get multiple offers, it is likely with just a few offers in the single digits but not guaranteed. With the changes in the market, many Buyers have been knocked out of their budgets meaning that there are less Buyers in the market. The situation remains fluid as the weeks progress.</p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">It is important to note that the real estate market of the last 2 years was never sustainable. The aggression of Buyers were fueled by historically low interest rates and downpayments sourced from stock options that were up 23% in 2021, thereby allowing Buyers to downpay more funds into their homes and have lower monthly payments due to low mortgage rates. Mortgage rates are still at all time historical lows.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The fact of the matter is that our government needs to get inflation under control and they will keep raising interest rates until then and it is having an effect.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">There are opportunities opening up especially for Buyers, but first let us see what has lead us to this moment and analysis in depth the economic leading indicators.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">Inflation Rates<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">Inflation came down slightly to 8.3% from 8.5% prior. Everything is more expensive, fuel prices, groceries, the cost of food when dining out, vehicles, etc. COVID continues to cause issues on the supply chain across the world and the war in Ukraine has not helped matters.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXPZi5Kd-WtyRE3gcg35CuVn0cc8MT1O7KrCSoijDtIEbs9GvmmapeW7tbXBJL1LGfs2iat4xybOEDjDydIzQ0sTt18ou8Qkqou5mafHpyLl49_mDAw-f0ieXmVxifKvSKQWl9v6kuJyStDDOsbgfPbd8m7VaGUyXGKAVoSbH5mOJvDbHUooMxp8iDww/s936/Exhibit%201%202022%20Inflation%20Chart.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="704" data-original-width="936" height="301" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjXPZi5Kd-WtyRE3gcg35CuVn0cc8MT1O7KrCSoijDtIEbs9GvmmapeW7tbXBJL1LGfs2iat4xybOEDjDydIzQ0sTt18ou8Qkqou5mafHpyLl49_mDAw-f0ieXmVxifKvSKQWl9v6kuJyStDDOsbgfPbd8m7VaGUyXGKAVoSbH5mOJvDbHUooMxp8iDww/w400-h301/Exhibit%201%202022%20Inflation%20Chart.jpg" width="400" /></a></div><span style="color: #222222;"> </span><p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;"><v:shapetype coordsize="21600,21600" filled="f" id="_x0000_t75" o:preferrelative="t" o:spt="75" path="m@4@5l@4@11@9@11@9@5xe" stroked="f"><v:stroke joinstyle="miter"><v:formulas><v:f eqn="if lineDrawn pixelLineWidth 0"><v:f eqn="sum @0 1 0"><v:f eqn="sum 0 0 @1"><v:f eqn="prod @2 1 2"><v:f eqn="prod @3 21600 pixelWidth"><v:f eqn="prod @3 21600 pixelHeight"><v:f eqn="sum @0 0 1"><v:f eqn="prod @6 1 2"><v:f eqn="prod @7 21600 pixelWidth"><v:f eqn="sum @8 21600 0"><v:f eqn="prod @7 21600 pixelHeight"><v:f eqn="sum @10 21600 0"></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:formulas><v:path gradientshapeok="t" o:connecttype="rect" o:extrusionok="f"><o:lock aspectratio="t" v:ext="edit"></o:lock></v:path></v:stroke></v:shapetype><v:shape alt="Graphical user interface, chart, application
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That is a 73% increase in the mortgage interest rate. We are still at historical lows, but that is a major payment shock for Buyers. The approach to cooling home prices is working as the Federal Reserve intended, which is to slow down home prices and the real estate market.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">Here are the nationwide 30-year fixed mortgage rates. <o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">30 Year Fixed Mortgage Average Rate</span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"></span></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjcrRsLevk42Bqcmd5JNF5qqHTwZI_t98XtZUXJEhcWnq-aitwrb4i6O_jQQd28jHRIqS_yUrtrne3NJk-IC-ESzfJIsqB4zZ67PPASalJjdMwrTBDTuxJThcmaAf9BQ39i0Eg0lOqEPk9GCpm5K6T67BSJjW-OJzdo_-hqgmQUDXSczCcZJPdquXsk8w/s936/Exhibit%202%2030%20Year%20Fixed.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="344" data-original-width="936" height="148" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjcrRsLevk42Bqcmd5JNF5qqHTwZI_t98XtZUXJEhcWnq-aitwrb4i6O_jQQd28jHRIqS_yUrtrne3NJk-IC-ESzfJIsqB4zZ67PPASalJjdMwrTBDTuxJThcmaAf9BQ39i0Eg0lOqEPk9GCpm5K6T67BSJjW-OJzdo_-hqgmQUDXSczCcZJPdquXsk8w/w400-h148/Exhibit%202%2030%20Year%20Fixed.jpg" width="400" /></a></div><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;">St Louis Federal Reserve<o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><a href="https://fred.stlouisfed.org/series/MORTGAGE30US" style="color: #954f72;">https://fred.stlouisfed.org/series/MORTGAGE30US</a><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;"> </span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><span style="color: #222222;">Snapshot of Wells Fargo Home Mortgage Rates<o:p></o:p></span></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b><span style="color: #222222;"><br /></span></b></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b></b></p><div class="separator" style="clear: both; text-align: center;"><b><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjv0o_M-Uf9Es1e-1WdSHtvfHJFpH9ynZk5S7OrFhUFv3QKqAEfbnQwyvL_xkysQmYtZRjqbVKhMVsaK_PJJ6tbh36MtVFmdrpfZQDG8IXRX7ragckawPicaGvb3p02Raxho9wtPiwlmncKrm9hU19Zdb28w5Xh5p5uauoScmpfFNEFADB0tI-QW1h5GQ/s656/Exhibit%203%20Snapshot%20of%20Wells%20Fargo%20Rates.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="640" data-original-width="656" height="390" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjv0o_M-Uf9Es1e-1WdSHtvfHJFpH9ynZk5S7OrFhUFv3QKqAEfbnQwyvL_xkysQmYtZRjqbVKhMVsaK_PJJ6tbh36MtVFmdrpfZQDG8IXRX7ragckawPicaGvb3p02Raxho9wtPiwlmncKrm9hU19Zdb28w5Xh5p5uauoScmpfFNEFADB0tI-QW1h5GQ/w400-h390/Exhibit%203%20Snapshot%20of%20Wells%20Fargo%20Rates.jpg" width="400" /></a></b></div><br /><p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;"><v:shape alt="Graphical user interface, application
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Description automatically generated" src="file:////Users/alanwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image004.png"></v:imagedata></v:shape></span><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;">Source – Yahoo! Finance<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;"><br /></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">Unemployment Rate<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;"> </span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">The good news is that the California unemployment rate has come down from the 16% rate back to the 4.6% range which were pre-covid levels. The local job market has recovered post covid.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgiKCltvYaBae7Rn5nk6jUoW2Mvbi8C-8a00079rREM69lwwGxSE9lg5vFEiWvuMGNflEdjbZoJ6_LurNR_lfza7DMdnUv8KFsXBuHyXN58A-peClok65I3yOtMZXgC8qsrIZwliMqaYaIS43kwvtVJk45LO8HvIOb28xphAmG0CBaspOggJScAb6KLIw/s468/Exhibit%205%20Unemployment.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="187" data-original-width="468" height="160" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgiKCltvYaBae7Rn5nk6jUoW2Mvbi8C-8a00079rREM69lwwGxSE9lg5vFEiWvuMGNflEdjbZoJ6_LurNR_lfza7DMdnUv8KFsXBuHyXN58A-peClok65I3yOtMZXgC8qsrIZwliMqaYaIS43kwvtVJk45LO8HvIOb28xphAmG0CBaspOggJScAb6KLIw/w400-h160/Exhibit%205%20Unemployment.jpg" width="400" /></a></div><span style="color: #222222;"> </span><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><v:shape alt="Chart, line chart
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Description automatically generated" src="file:////Users/alanwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image005.png"></v:imagedata></v:shape></span><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><a href="https://data.bls.gov/pdq/SurveyOutputServlet" style="color: #954f72;"><span style="color: #888888;">https://data.bls.gov/pdq/SurveyOutputServlet</span></a><u><span style="color: #888888;"><o:p></o:p></span></u></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><u><span style="color: #888888;"> </span></u></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><u><span style="color: #888888;"> </span></u></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Impact of Rising Rates and Lower NASDAQ on Buyers<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The model below shows a Buyers mortgage and downpayment at the beginning of 2022 and their scenarios now. For simplicity, we make an assumption that 100% of Buyers downpayment are from stocks, there is a subsequent 28% reduction in downpayment or a need to find those funds elsewhere that need to be bridged. Most Buyers will not want to sell their equity stocks now, which means they would need to have the cash in hand or liquidate another source of liquid assets. The second component is the jump in monthly payments due to interest rates is substantial. Unless a Buyer can bridge the downpayment and their lending ratios can still support these new rates, Buyers will be affording less on offer prices. We have had multiple Buyers re-calculate their buying power which has reduced in accordance with the reduction in their portfolios.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEkG5RMGpCiKl-oZkgaLKF56WajnVyYsL1XlXnLAApx2Ksu5ghHWiQm9vKw1Gb-p7TqEYmskk4ZH0B4d1BE1kC429_ljXjTC_u5cJe2rFPLuutSVaPvznHZYCl48Zn9_iAgqG0R9H2inw5C173uM7JkbUJYBBsMalcAso13KR2JpAD4aysZVv5JsxGug/s936/Exhibit%206%20NASDAP%20and%20Mortgage%20Buyer%20Impact.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="516" data-original-width="936" height="220" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEkG5RMGpCiKl-oZkgaLKF56WajnVyYsL1XlXnLAApx2Ksu5ghHWiQm9vKw1Gb-p7TqEYmskk4ZH0B4d1BE1kC429_ljXjTC_u5cJe2rFPLuutSVaPvznHZYCl48Zn9_iAgqG0R9H2inw5C173uM7JkbUJYBBsMalcAso13KR2JpAD4aysZVv5JsxGug/w400-h220/Exhibit%206%20NASDAP%20and%20Mortgage%20Buyer%20Impact.jpg" width="400" /></a></div><br /><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"> </p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>2022 Projections and Beyond</b><o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">In the short run we are in a strange market where the Buyers that are in the market will make lower offers and Sellers will hold onto to previous prices. Expect the market to continue to level and adjust for the remainder of the year and likely into next year. Beyond leveling there are price adjustments that will occur sale by sale and week by week. All eyes are on the Federal Reserve and how aggressive they plan to be and how high the mortgage rate will go. The NASDAQ also needs to be monitored if it drops further into a bear market.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Buyers, if you and your family have a need to buy and you plan to be in the home for the long run, it is your window to get into a property! The last market was exhausting and it will be nice to be able to have some time to decide on homes and getting back to negotiating with Sellers.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Sellers, this adjustment will be the most difficult for you as this is a significant shift in the marketplace. We need to take the comparable market data from previous months with a major grain of salt since those were peak prices and the market is leveling and trending downward. Trust the offers that are coming in as the current market value of your property. You will need to be more patient with offers with the slight summer increase in competitors and the reduction of Buyers, the offers from Buyers will reflect the current market.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The market continues to adjust in search of a new normal, what that market develops into is yet to be seen.</p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><b>Feeling Social?</b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: left;">Join the conversation on Linkedin! <a href="https://www.linkedin.com/pulse/may-2022-silicon-valley-real-estate-update-market-correction-wang/?trackingId=03vhpPI0LGaQRyg4d6Cg7g%3D%3D">https://www.linkedin.com/pulse/may-2022-silicon-valley-real-estate-update-market-correction-wang/?trackingId=03vhpPI0LGaQRyg4d6Cg7g%3D%3D</a></p>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6677356073587079062.post-50346130881664284112022-04-01T11:28:00.002-07:002022-04-01T11:28:28.094-07:00 Q1 2022 Silicon Valley Real Estate Update – Possible Leveling on the Horizon<p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://www.youtube.com/watch?v=8ah4GWyCy1M" imageanchor="1" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" data-original-height="405" data-original-width="720" height="225" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2we8n9Wsnjva0WTg2yy1Rj5qGzPZXqw1L5EOJqEM-p0VzUi63anoEu436oQ2KFJ9BkKj-0KqT6Z9fhtDsNap-xCIOGT_jf7n7PSLSO9YvWZ-orFaC1CBgP1DrUM01try8Zig3UY5NX21zCXq0r0Oqwq4t4es6epuKM1P3NaS-B40HX8QhiWDg-petEw/w400-h225/Slide1.jpeg" width="400" /></a></div><div style="text-align: center;">Video Summary Here</div><div style="text-align: center;"><a href="https://www.youtube.com/watch?v=8ah4GWyCy1M">https://www.youtube.com/watch?v=8ah4GWyCy1M</a></div><div style="text-align: center;"><br /></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="text-align: left;">There are certainly many factors in-flux in our world today; inflation rates across the board, rising interest/mortgage rates, volatile stock markets and the war in Ukraine. One would assume that this would dampen the sentiment of Buyers, however the answer is that in some areas it has and in most areas Buyers are still running aggressively in favor of the Seller. We are still seeing half of the offers before the war in Ukraine, anywhere from 5 to 7 offers on our listings. Quality remains strong even though the quantity has been lower. Buyers continue to offer over list price, with non-contingent offers and closing as quickly as their lenders can close.</span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">However, in the last month, we have seen a few odd datapoints of 1 to 2 offers on our listings and some properties that we have offered on. We are not sure if this is a localized phenomenon or a sign of a future market trend. This could be a momentarily blip or a more prolonged leveling. Nationwide some markets have been seeing this cooling as well. The fact of the matter is that inflation is out of control across multiple product sectors and the Federal Reserve plans to be aggressive in getting that under control. This will eventually inevitably slow down the real estate market as well. This level of price appreciation and overbidding was not sustainable and there could be a shift coming in the marketplace.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">Inflation Rates<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">Inflation hit another record high in February at 7.9%. The global supply chain issues from COVID are now coupled with further disruptions due to the war in Ukraine. The highest impacted sector is fuel prices due to our boycott of Russian oil and gas further restricting supply.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDrxoej87zhV4urJ-MtuJ4baigPXvLHNlzslwXve6tqyJ2MksDCJrafL7VUKWRTyVozm4SJSL73eXCVpgXWUImZjuyoJ7fLTw77_wCaKn17J9RLoCTOYXr4Kzzw9GRPT-ug8zU9YKar9k2DKyc8ScB2VR5VaaFFssaydxCDboJ3JMZdpqx8d2FztNtxQ/s738/Picture1.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="558" data-original-width="738" height="303" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiDrxoej87zhV4urJ-MtuJ4baigPXvLHNlzslwXve6tqyJ2MksDCJrafL7VUKWRTyVozm4SJSL73eXCVpgXWUImZjuyoJ7fLTw77_wCaKn17J9RLoCTOYXr4Kzzw9GRPT-ug8zU9YKar9k2DKyc8ScB2VR5VaaFFssaydxCDboJ3JMZdpqx8d2FztNtxQ/w400-h303/Picture1.png" width="400" /></a><span style="color: #222222; font-family: Calibri, sans-serif; text-align: left;"> </span></div><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><a href="https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm"><span style="color: #888888;">https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm</span></a><span style="color: #222222;"><o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">Interest Rates<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">Interest rates have increased from 3.875% to 4% locally for a 30-year fixed jumbo loan. These are still historical lows, but there are mixed reviews on the impact of rising rates. Some Buyers have felt that the increase has priced them out of their target budgets and desired monthly payments. Others are rushing to take advantage of the lower rates before they rise further.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">Here are the nationwide 30-year fixed mortgage rates. <o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">30 Year Fixed Mortgage Average Rate<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;"><br /></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b></b></p><div class="separator" style="clear: both; text-align: center;"><b><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh28RSeLTR3dDSJ7aIIapiaagrqHqVvxF6iVsCrM2pJo8XoGTW89IayUPVLG_FjGWAyZf-lxwHIZaA_x6wSYw11GhMtpCWA4Fx2q-gKGh-nzjY9IPOkbrPsz-aGhjZJkw7htFDvcKTbA3bDdc0rWuvh8dCk8TETfRdtT_X0hN-OKoceDCL7-1iwvJoJSg/s936/Picture2.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="348" data-original-width="936" height="149" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh28RSeLTR3dDSJ7aIIapiaagrqHqVvxF6iVsCrM2pJo8XoGTW89IayUPVLG_FjGWAyZf-lxwHIZaA_x6wSYw11GhMtpCWA4Fx2q-gKGh-nzjY9IPOkbrPsz-aGhjZJkw7htFDvcKTbA3bDdc0rWuvh8dCk8TETfRdtT_X0hN-OKoceDCL7-1iwvJoJSg/w400-h149/Picture2.png" width="400" /></a></b></div><p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;">St Louis Federal Reserve<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span> </p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">NASDAQ Index</span></b><span style="color: #222222;"><br /><br />The Technology heavy NASDAQ index fell 9.3% in 2022 since the peak at the beginning of this year, but still up from the lowest point at 20.5% on March 14<sup>th</sup>, 2022. The NASDAQ is critical as this is the source of down payments for our Silicon Valley home buyers. The volatility of the NASDAQ is likely a concern to home buyers who are not sure how much they can count on this source for their down payments.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhkLOeX82yLiTW9YRogwv5kMnoWnPn0jqXNlkvF_cazAJLseispc9eOtSr7zKhs2E2WjcVNJe4SRxxrsOtRwdjKZjjD9UK8LYimQREnz0jLolZTPUCBs0G7fbbMN17LNYrak4OBsxmNUNvgyxVdFqhOUOzvHI2ghh_txSZ-tUFtRhedz2LO7SOl1xbLrQ/s936/Picture3.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="558" data-original-width="936" height="239" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhkLOeX82yLiTW9YRogwv5kMnoWnPn0jqXNlkvF_cazAJLseispc9eOtSr7zKhs2E2WjcVNJe4SRxxrsOtRwdjKZjjD9UK8LYimQREnz0jLolZTPUCBs0G7fbbMN17LNYrak4OBsxmNUNvgyxVdFqhOUOzvHI2ghh_txSZ-tUFtRhedz2LO7SOl1xbLrQ/w400-h239/Picture3.png" width="400" /></a></div><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><v:shape alt="Chart, line chart
Description automatically generated" id="Picture_x0020_2" o:spid="_x0000_i1026" style="height: 278pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Chart, line chart
Description automatically generated" src="file:////Users/alanwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image003.png"></v:imagedata></v:shape></span><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><span style="color: #222222;">Source – Yahoo! Finance<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;">Unemployment Rate<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span style="color: #222222;"> </span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;">The good news is that the California unemployment rate has come down from the 16% rate back to 5.4%, just a little over 1% of the unemployment rate pre-covid. This means that the workforce is returning to their normal work lives as we all learn to live with COVID. Google mentioned that their workforce would return to the office on a part-time basis in April and Apple has already been back to the office as well. More companies are expected to follow suit.</span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjTY_Ty1AJmXvGeKg9Re8SDO65X-1ltEpvVMg46heOYMZies126jrp4gMMjG0dfdgFIxS_J5LhW_bD2CjknrUa-UdO1SDYh3ezIrExHOEdA9QYBq6DSnyLpRBndq6r3zedsVulpktzV64ZKLowhZM5Wh3YXCZBFNPxIbM1D5_rd3lA61dsLYCc0DrBHDA/s876/Picture14.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="560" data-original-width="876" height="205" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjTY_Ty1AJmXvGeKg9Re8SDO65X-1ltEpvVMg46heOYMZies126jrp4gMMjG0dfdgFIxS_J5LhW_bD2CjknrUa-UdO1SDYh3ezIrExHOEdA9QYBq6DSnyLpRBndq6r3zedsVulpktzV64ZKLowhZM5Wh3YXCZBFNPxIbM1D5_rd3lA61dsLYCc0DrBHDA/s320/Picture14.png" width="320" /></a></div><p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="color: #222222;"><v:shape alt="Table
Description automatically generated" id="Picture_x0020_1" o:spid="_x0000_i1025" style="height: 280pt; visibility: visible; width: 438pt;" type="#_x0000_t75"><v:imagedata o:title="Table
Description automatically generated" src="file:////Users/alanwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image004.png"></v:imagedata></v:shape></span><span style="color: #222222;"><o:p></o:p></span></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><a href="https://data.bls.gov/pdq/SurveyOutputServlet"><span style="color: #888888;">https://data.bls.gov/pdq/SurveyOutputServlet</span></a><span style="color: #222222;"><o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b style="text-align: center;">Q2 2022 Projections and Beyond</b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><o:p></o:p></p><p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The market will need to be closely monitored. Undoubtedly there is still momentum in most markets in the Bay Area and this Sellers’ market will continue. <o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">However, these macroeconomic factors seem to indicate that there will be a slower market for Sellers in certain locations and for certain product types in the short run. There could be a greater slowdown across the board in the long run. Given the overall low supply and momentum of the market, we are not anticipating overnight changes, but likely a gradual change assuming these economic factors change gradually as well.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">As a Buyer, we know it has been a tiring and frustrating journey with the level of multiple offers and levels of price overbids. If you and your family have been in the market for a home, in the short run offers will still be strong, however, opportunities may present themselves in various areas. It might be a good time to come back to the market or continue to put offers in order to get that home for you and your family. Consult our team for a deeper evaluation of your specific target location so that we can better advise you.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">A leveling market is the toughest for Sellers. Sellers have had high expectations of multiple offers and extreme overbidding for over the last two years. With the possibility of us coming off peak, rest assured that you have had such a high level of appreciation and you will still have amazing gains. For some you just missed the peak, for others your area may still have momentum. Remember that multiple offers are a great story to tell, but in the end we can only accept one offer. Regardless, we recommend that you strike while the market is still hot. The future no one can predict.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">It has certainly been an eventful couple of years in the real estate world. Let us know how we might be of assistance with the real estate needs of you and your family.</p>Unknownnoreply@blogger.com3tag:blogger.com,1999:blog-6677356073587079062.post-74482503126805996452022-01-05T14:49:00.003-08:002022-01-05T14:52:15.420-08:002021 Silicon Valley Real Estate Year in Review and 2022 Outlook<p style="font-family: Menlo; font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEg2p4z0AtfWsWnyp1tcRfT7TFPE6qTBrPxnGNV2yeOu7Kg7Yv68k-6OMnzjyQrGA2MfPU0aYkT8puEtuw03JorynoyN_dhuHrWhj98S-JYB_70pJblX0oixuLA3WFZp6w6xuMwI8H10Guhag6TnTZxT1tW49S5VmBIEl6cHWvF9i7krkVbcpZOaLP_WUA=s1400" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="425" data-original-width="1400" height="194" src="https://blogger.googleusercontent.com/img/a/AVvXsEg2p4z0AtfWsWnyp1tcRfT7TFPE6qTBrPxnGNV2yeOu7Kg7Yv68k-6OMnzjyQrGA2MfPU0aYkT8puEtuw03JorynoyN_dhuHrWhj98S-JYB_70pJblX0oixuLA3WFZp6w6xuMwI8H10Guhag6TnTZxT1tW49S5VmBIEl6cHWvF9i7krkVbcpZOaLP_WUA=w640-h194" width="640" /></a></div><p></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times; font-variant-ligatures: no-common-ligatures;">We hope that you and your families had an amazing holiday break and that you had good food and some good rest. We wish you and your families a healthy and prosperous 2022!</span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times;"><span style="font-variant-ligatures: no-common-ligatures;"><br /></span><span class="s1" style="font-variant-ligatures: no-common-ligatures;"><b>2021 Silicon Valley Real Estate Year in Review<br /></b></span><span class="s1" style="font-variant-ligatures: no-common-ligatures;"><br /></span></span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;">2021 was yet another Sellers’ market, in fact the most aggressive that we have seen in over 18 years in the business. The explanation lies at the intersection of housing needs, the influx of wealth and more borrowing power all playing a critical role.</span></span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"><br /></span><span class="s1" style="font-variant-ligatures: no-common-ligatures;">The first pillar of the Maslow Hierarchy of Needs identifies shelter as a basic human need. With COVID variants mutating with no end in sight, the local workforce will continue to work from home for the foreseeable future. With these circumstances, a home office is a key requirement creating the need to upsize to a home with more bedrooms and more space overall. Outdoor space remains critical, as it is still safer to congregate outdoors rather than in tight indoor spaces. The second factor attributing to this aggressive buyer pool is that Buyers have increasing wealth from their company stock options. The NASDAQ index increased by 23% in 2021, putting wealth in the pockets of our local technology workers. Homeowners that were looking to upsize, also had equity in their previous primary homes as well. Lastly, interest rates though up slightly, remained at historical lows in 2021, thereby increasing Buyers purchasing power on homes.</span></span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEgqXuVgW8O_Tl0c2GTbdIrVBtx38SKuq3SBmC2Ju3tC3uj_biFtsdkhhlqd2QPqhLN7E9gp-zItpf2r-JBI_RK3OM3PH6HfK_suenT_3I1OxKqk5EtuWLIY4NBi9UN-RZNZ5cthIDQsW2HBEnoE6K7UOe9qmpR7wjT8T4AK_QxynqX2w-j4VaWlGIvJ4w=s208" style="margin-left: 1em; margin-right: 1em;"><span style="font-family: times;"><img border="0" data-original-height="170" data-original-width="208" height="327" src="https://blogger.googleusercontent.com/img/a/AVvXsEgqXuVgW8O_Tl0c2GTbdIrVBtx38SKuq3SBmC2Ju3tC3uj_biFtsdkhhlqd2QPqhLN7E9gp-zItpf2r-JBI_RK3OM3PH6HfK_suenT_3I1OxKqk5EtuWLIY4NBi9UN-RZNZ5cthIDQsW2HBEnoE6K7UOe9qmpR7wjT8T4AK_QxynqX2w-j4VaWlGIvJ4w=w400-h327" width="400" /></span></a></div><div style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">Average home prices in Santa Clara County increased 18% across Single Family, Townhomes and Condominiums in 2021. The Single-Family Home sector continued to be the coveted prize in 2021. Inventory has been so low that multiple offers were almost guaranteed on the majority of properties. For Buyers, it has been a survival of the fittest in this historic Sellers’ market. Buyers who can go the highest in terms of price, with the strongest financial position and the least amount of terms and conditions are deemed the winners. The winning bid continuously pushes the last sale price and often was rooted in the pure desire to win the home. The Townhome sector also saw a comeback from the second quarter onward, likely that due to being priced out of the Single Family Home sector. The Condominium sector has seen some recovery as well, though still more of a Buyers’ market to a more balanced market for this sector. Buyers prefer to have more space if possible.</span></div><div style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span style="font-family: times;"><span style="font-variant-ligatures: no-common-ligatures;"><br /></span><span class="s1" style="font-variant-ligatures: no-common-ligatures;"><b>NASDAQ Index</b></span><br /><span class="s1" style="font-variant-ligatures: no-common-ligatures;"><br /></span></span></div><div style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">The Technology heavy NASDAQ index gained 23.2% in 2021. This armed our Silicon Valley home buyers with down payments and equity to bid in this aggressive market.</span></div><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"></span></p><p style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEj4qbIgauUAHXRwRw3XQ22Ftf864JjR6pJzTkkUu006dflCHCVfLuCBcQHLOZrYnLL06wMOv3UB4OKYUpHf11CBGwj43i6jzLIzpAQzSQwjW7DZIMmbqJtzuL_fcQ_ct3fobbK2IdMLaacpFxBo8qRkZqgXaFCHaAmLTN_hezrKD3p2BEt5nq86N_pfIQ=s468" style="margin-left: 1em; margin-right: 1em;"><span style="font-family: times;"><img border="0" data-original-height="319" data-original-width="468" height="272" src="https://blogger.googleusercontent.com/img/a/AVvXsEj4qbIgauUAHXRwRw3XQ22Ftf864JjR6pJzTkkUu006dflCHCVfLuCBcQHLOZrYnLL06wMOv3UB4OKYUpHf11CBGwj43i6jzLIzpAQzSQwjW7DZIMmbqJtzuL_fcQ_ct3fobbK2IdMLaacpFxBo8qRkZqgXaFCHaAmLTN_hezrKD3p2BEt5nq86N_pfIQ=w400-h272" width="400" /></span></a></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><b style="font-variant-ligatures: no-common-ligatures;"><span style="font-family: times;">Interest Rates</span></b></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times; font-variant-ligatures: no-common-ligatures;">Interest rates have stayed low in the 2.5% to 3.5% range. These are still historical lows, undoubtedly a key contributor to increasing home prices due to higher buying power for buyers.</span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEhRXIqAh-MHx8KU5SEiv9UptjFh9dwK24BrRS7mkWrYmttp0otB4zfKoX1gI0iGA59L4-KHYnagtq4DCvEjGMZ0RqpyacYMBPfCbMPD-tW4HRQ6kVUrhAfu-LPlLZqJbdS5uHKyJMNj1pZ-2C8Bnx-yWy35QhIg4446o7NJogHSR4yWyoF-E_z80oDX2Q=s468" style="margin-left: 1em; margin-right: 1em;"><span style="font-family: times;"><img border="0" data-original-height="156" data-original-width="468" height="134" src="https://blogger.googleusercontent.com/img/a/AVvXsEhRXIqAh-MHx8KU5SEiv9UptjFh9dwK24BrRS7mkWrYmttp0otB4zfKoX1gI0iGA59L4-KHYnagtq4DCvEjGMZ0RqpyacYMBPfCbMPD-tW4HRQ6kVUrhAfu-LPlLZqJbdS5uHKyJMNj1pZ-2C8Bnx-yWy35QhIg4446o7NJogHSR4yWyoF-E_z80oDX2Q=w400-h134" width="400" /></span></a></div><div class="separator" style="clear: both; text-align: center;"><span style="font-family: times;">St Louis Federal Reserve</span></div><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><br /></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><b style="font-variant-ligatures: no-common-ligatures;"><span style="font-family: times;">Inflation Rates</span></b></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span style="font-variant-ligatures: no-common-ligatures;">Inflation hit a record high in November at 6.8%. Over the past 20 years, inflation has hovered generally around 2%. Like many businesses, when COVID hit, businesses lowered demand expectations and their workforces were forced to work from home. The lockdown pandemic created a high rate of consumer savings and when we emerged from the worst of the pandemic, the demand for food, goods, services, vehicles, etc all skyrocketed. This demand shocked the already disrupted supply chain, with labor shortages and created a shortage of products. Heavy demand and low supply equated to increased prices and subsequently inflation. When it comes to manufacturing and supply chain processes in a global economy, it is difficult to simply jumpstart that engine within an ongoing pandemic.</span><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEg0uB1vbS_b1LJN7PTLArT1z6flzMq2tzgpJCHwzKqdFuKsx1vG3d0Pbc5MjjaMZPqG7yMSFCtis1S37gDPHDp0sl_Ho3CE_MvkqzSmA7GdJ99JFotPuvLX4sc2lzwR6GctUYLpz6o9gXmU-Uabkn6GsQKFtWNW2zcysrbMaIYaA131RjTrBOBe_NhRQg=s468" style="margin-left: 1em; margin-right: 1em;"><span style="font-family: times;"><img border="0" data-original-height="346" data-original-width="468" height="296" src="https://blogger.googleusercontent.com/img/a/AVvXsEg0uB1vbS_b1LJN7PTLArT1z6flzMq2tzgpJCHwzKqdFuKsx1vG3d0Pbc5MjjaMZPqG7yMSFCtis1S37gDPHDp0sl_Ho3CE_MvkqzSmA7GdJ99JFotPuvLX4sc2lzwR6GctUYLpz6o9gXmU-Uabkn6GsQKFtWNW2zcysrbMaIYaA131RjTrBOBe_NhRQg=w400-h296" width="400" /></span></a></div><span style="font-family: times;"><br /></span><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: center;"><span style="font-family: times; font-variant-ligatures: no-common-ligatures;"><a href="https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm">https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm</a></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><b>Unemployment Rate</b></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">California unemployment has dropped from the early pandemic high of 16% in April of 2020 to 6.9%. This is a good trend for the job market overall.</span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/a/AVvXsEi6PV6zyKgYWCQ-y41KGVSoQ88XAAnbpTeA2mVTZpMnbG96vN_l6CKE8L2V0F8roV0u2u0fwH7OVIwAZFQtkJsxoTadk7qVSDXwqTrrcyAYD8uCwM7L2tZEME1Lro6fm5uQpwO3_p-9bZe699z-00FEFnNjzq2B5eG58ithpLzDV1sQa07SKO-a2F_VPA=s468" style="margin-left: 1em; margin-right: 1em;"><span style="font-family: times;"><img border="0" data-original-height="181" data-original-width="468" height="155" src="https://blogger.googleusercontent.com/img/a/AVvXsEi6PV6zyKgYWCQ-y41KGVSoQ88XAAnbpTeA2mVTZpMnbG96vN_l6CKE8L2V0F8roV0u2u0fwH7OVIwAZFQtkJsxoTadk7qVSDXwqTrrcyAYD8uCwM7L2tZEME1Lro6fm5uQpwO3_p-9bZe699z-00FEFnNjzq2B5eG58ithpLzDV1sQa07SKO-a2F_VPA=w400-h155" width="400" /></span></a></div><span style="font-family: times;"><br /></span><p></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: center;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><a href="https://data.bls.gov/pdq/SurveyOutputServlet">https://data.bls.gov/pdq/SurveyOutputServlet</a></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><b>2022 Real Estate Outlook</b></span></p><p class="p2" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; min-height: 13px; text-align: left;"><span style="font-family: times;"><span class="s1" style="font-variant-ligatures: no-common-ligatures;"></span><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">In the short run, low inventory and high demand will likely keep real estate prices high and competition fierce. The biggest concern is the inflation rate and will that stabilize over time? Will our supply chain ramp up to meet demand thereby lower prices naturally, or will this continue to be an issue. The Federal Reserve does not appear to be interested in taking the wait and see approach. They plan to raise interest rates three times in 2022. The impact is yet to be determined based on how aggressively the rates are increased. Regardless, rate hikes will eventually affect the interest rates on mortgages and if done aggressively could lower home buying power and slow down the rate of price increases. If this also dampens the mood of the stock markets, we could have 2 key pillars of home buyer aggression neutralized. This could create a more balanced market overall. My projection would be that in the short run little will change and perhaps the latter half of 2022 we may see some possible leveling in the market, but will it be enough to overcome Buyers’ housing needs? That is yet to be seen.</span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><b>Schedule Your Custom Real Estate Strategy Consultation Meeting</b></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">Everyone family has a unique real estate scenario specific to their needs and circumstances. We are always available to have a strategic consultation meeting with you to address your needs and come up with an execution plan. Book your consultation with us today at <a href="mailto:homes@alanwangrealty.com">homes@alanwangrealty.com</a> or call and text us at (408)313-4352.</span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;"><br /></span></p><p class="p1" style="font-stretch: normal; font-variant-east-asian: normal; font-variant-numeric: normal; line-height: normal; margin: 0px; text-align: left;"><span class="s1" style="font-family: times; font-variant-ligatures: no-common-ligatures;">Again stay safe and have an amazing 2022!</span></p>Unknownnoreply@blogger.com14tag:blogger.com,1999:blog-6677356073587079062.post-33336248745672678012021-08-01T11:11:00.006-07:002021-08-02T07:28:01.898-07:00July 2021 Silicon Valley Real Estate Update<div class="separator" style="clear: both; text-align: left;"><a href="https://1.bp.blogspot.com/-84iCSDVtHDQ/YQbiX28uGKI/AAAAAAAAMvY/ygw3HyiusTYfCNztU-qvmTguk0XLp3lBgCLcBGAsYHQ/s1400/2021%2BJuly%2BSilicon%2BValley%2BReal%2BEstate%2BYear%2Bin%2BReview.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="425" data-original-width="1400" height="194" src="https://1.bp.blogspot.com/-84iCSDVtHDQ/YQbiX28uGKI/AAAAAAAAMvY/ygw3HyiusTYfCNztU-qvmTguk0XLp3lBgCLcBGAsYHQ/w594-h194/2021%2BJuly%2BSilicon%2BValley%2BReal%2BEstate%2BYear%2Bin%2BReview.png" width="594" /></a></div><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">The Silicon Valley real estate market remains a strong Sellers’ market.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Single Family Home Sector</span></b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><br /><br />The Single Family Home sector continues to be strong with homes selling with multiple offers within the first 2 weeks on the market. However, due to a slight increase in summer inventory, not every property necessarily will sell in this manner. When Buyers have options, a less desirable home (poor condition, not staged, hard to show owner/tenant occupied, etc) may sit on the market longer. These homes will still likely sell within a month regardless, unless the home is overpriced.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Townhome Sector</span></b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><br /><br />The Townhome sector is on the mend in the last quarter. As Single Family Home prices have sky rocketed and Covid restrictions have eased for the meantime, the need for yard space is not as pressing as in 2020. We are seeing a couple to a handful of multiple offers in this sector assuming the property is in move-in condition.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Condominium Sector<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">The Condominium sector, which was completely abandoned in 2020, has shown signs of a recovery as well. Workers have been returning to the Bay Area anticipating returning to the office in the September timeframe. We are seeing quality offers within a couple of weeks but be prepared for 30 days on the market for certain properties as this sector is still recovering. The rental market is recovering as well.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">2021 Projections<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">For the rest of 2021 there does not seem to be a slowdown in the marketplace, but we will need to be monitored on the Covid/variant front. If the cases remain under control, then all 3 sectors will continue to perform well. If we lockdown and shelter-in-place once again, the Single Family Home sector will spike once again and the Townhome and Condominium sectors will fizzle. At this moment I do not anticipate a slowdown in 2021. This assumes that interest rates, tech employment and the NASDAQ stock market remain consistent.</span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Contact Us<o:p></o:p></span></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">This is a complex market. As a Seller, even though we are in a Sellers’ market, you will need a team to help you position your property in a manner that maximizes your returns. If you are a Buyer, you will need a team that moves quickly, that knows how to win but within reason to what the market is dictating. </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Please reach out to us so that we can analyze your specific real estate scenario.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"> </span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Reach us at <a href="mailto:alan@alanwangrealty.com" style="color: #954f72;">alan@alanwangrealty.com</a> or (408)313-4352.<o:p></o:p></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><b>Feeling Social?</b></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><b><br /></b></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="background-color: white;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Join the conversation on Linkedin! </span><span style="caret-color: rgba(0, 0, 0, 0.9); color: rgba(0, 0, 0, 0.9); font-family: -apple-system, system-ui, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", "Fira Sans", Ubuntu, Oxygen, "Oxygen Sans", Cantarell, "Droid Sans", "Apple Color Emoji", "Segoe UI Emoji", "Segoe UI Symbol", "Lucida Grande", Helvetica, Arial, sans-serif; font-size: 16px;"><a href="https://www.linkedin.com/pulse/july-2021-silicon-valley-real-estate-update-alan-wang">https://www.linkedin.com/pulse/july-2021-silicon-valley-real-estate-update-alan-wang</a></span></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="caret-color: rgb(29, 28, 29); color: #1d1c1d; font-size: 15.333333015441895px;">We wish you and your families the utmost safety during this continuing trying times.</span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;"><br /></span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span face="Arial, sans-serif" style="color: #1d1c1d; font-size: 11.5pt;">Alan Wang Realty Group</span><o:p></o:p></p>Unknownnoreply@blogger.com22tag:blogger.com,1999:blog-6677356073587079062.post-25248595618436699402021-04-10T11:38:00.008-07:002021-04-10T11:40:13.397-07:00April 2021 Silicon Valley Real Estate Update<p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-LeYZQywuLcc/YHHwclKN3LI/AAAAAAAAMkE/Xp7L1G4zzYUoweTN7XKD7xyzRGhC2NYuwCLcBGAsYHQ/s1400/April%2B%2B2021%2BReal%2BEstate%2BYear%2Bin%2BReview.png" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="425" data-original-width="1400" height="178" src="https://1.bp.blogspot.com/-LeYZQywuLcc/YHHwclKN3LI/AAAAAAAAMkE/Xp7L1G4zzYUoweTN7XKD7xyzRGhC2NYuwCLcBGAsYHQ/w586-h178/April%2B%2B2021%2BReal%2BEstate%2BYear%2Bin%2BReview.png" width="586" /></a></div><br /><span color="rgba(0, 0, 0, 0.75)" style="font-family: "Source Serif Pro", serif; font-size: 2rem;"><br /></span><div><span color="rgba(0, 0, 0, 0.75)" style="font-family: "Source Serif Pro", serif; font-size: 2rem;"><br /></span></div><div><br /></div><div><br /></div><div><br /></div><div><span color="rgba(0, 0, 0, 0.75)" style="font-family: "Source Serif Pro", serif; font-size: medium;"><br /></span></div><div><br /></div><div><br /></div><div><span color="rgba(0, 0, 0, 0.75)" style="font-family: "Source Serif Pro", serif; font-size: medium;">The real estate market remains largely unchanged from our March update. Interest rates have inched up slightly, but that has not put a damper on Buyer's enthusiasm. The Single Family home sector continues to be the most aggressive that we have seen in our near 18 years in the business. If you are looking to buy a Single Family Home you have to be well-positioned financially, have the will to want it more than other families and a strong team behind you. Unfortunately, cash offers seem to be more abundant this year, reminding us of the times when foreign funds were pouring into the valley. Tech Buyers are turning their restricted stock and options into real estate assets. This sector continues to accelerate and the winners are the ones that do what it takes to win. As disheartening as this process can be, our key advice is to get in and out of the market as quickly as possible and allow other Buyers to keep bidding prices up. You don’t want to be in a position where you are chasing the market. The Townhome sector is regaining traction as Buyers who are priced out of Single Family homes have more opportunities in this sector. The condo sector is slowly showing signs of life as well.</span></div><div><span style="color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-size: medium;"><br /></span></div><div><span style="color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-size: medium;">We anticipate 2021 to be more of the same. Low inventory, low-interest rates, overall healthy stock market equating to multiple offers. In short, it will continue to be a very strong Sellers’ market.</span></div><div><span style="color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-size: large;"><br /></span></div><div><span style="color: rgba(0, 0, 0, 0.75); font-family: "Source Serif Pro", serif; font-size: large;">We wish you and your family a happy start to the upcoming summer months and continue to stay safe! There seems to be a light at the end of the COVID tunnel!</span></div>Unknownnoreply@blogger.com18tag:blogger.com,1999:blog-6677356073587079062.post-29765571649702507402021-03-02T10:12:00.004-08:002021-03-02T10:23:06.633-08:00March 2021 Silicon Valley Real Estate Update - A Market on Fire<div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-y-iwW8jWprQ/YD5_kwfGrNI/AAAAAAAAMiI/WHtAi8WyqR0XWJ2fp7mhbZInfKrlASsUACLcBGAsYHQ/s936/https-%253Aupswingpoker.com%253Apoker-chip-values-colors%2B2.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="368" data-original-width="936" height="158" src="https://1.bp.blogspot.com/-y-iwW8jWprQ/YD5_kwfGrNI/AAAAAAAAMiI/WHtAi8WyqR0XWJ2fp7mhbZInfKrlASsUACLcBGAsYHQ/w400-h158/https-%253Aupswingpoker.com%253Apoker-chip-values-colors%2B2.png" width="400" /></a></div><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: left;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">In the 18 years that we have been in business, we have seen our share of competitive bull markets in the real estate industry. Yet 2021 has unveiled a level of aggression that even we have never seen before. Buyers have been desperately pushing over list prices and appraisal values, often in $50,000 to $100,000 increments or greater. I equate this to a poker game where players are raising with $50,000 to $100,000 chips at a time. Often Buyers have been all-in with their savings and investments. With the current work/life situations caused by the pandemic likely to linger, Buyers have been laser focused on the Single-Family Home sector as Buyers have been looking for more bedrooms and more backyard space. This is directly causing unprecedented bidding wars.</p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Why is This Happening?<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">This is an example of the inequities that are on full display in our microeconomy. There are certainly many in our nation that have been impacted by the pandemic. However, in the Silicon Valley, it provided an even deeper advantage especially to those in the technology sector. Unlike like those that have been impacted locally or in the rest of the nation, the technology, medical and financial sectors continue to have high employment rates. When a dual income family remains employed, so does their confidence in pursuing or upgrading their housing needs. Also unique to the Silicon Valley are stock options or restricted stock units, which are the life blood of Silicon Valley down payments and wealth creation. With the NASDAQ trading 53% higher than the same time last year, Bay Area home buyers have the collateral to back up their purchases. Lastly, once again record low interest rates, designed to bolster the overall economy, further provides local homebuyers with access to money at a very low cost. This perfect storm is at the root of the hyperactivity in our real estate market.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>State of the Market<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">As forementioned, Single Family Homes are on fire pretty much anywhere you go in the Silicon Valley and even in the nation. The trend of buying in the East Bay has elevated to astronomical levels in 2021 as Buyers continue to realize that they get much more for their money and they are expecting not to go back to the office in the near future. It is my opinion that Buyers should be cautious with this assumption, I believe that companies will eventually want workers back in the office. In the blink of an eye you may find yourself in a 3-hour commute a couple years from now.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Bidding wars abound and we are in a full Sellers’ market. In 2020 the Townhome and Condominium markets struggled, however this year both of these sectors have been showing signs of life. This is likely due to Buyers being priced out of the Single-Family Home market and shifting to the Townhome and subsequently the Condominium market. Even San Francisco in the last few weeks has seen a pickup in demand in the Condominium sector. <o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Buyer Advice<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">This Sellers’ market is not for the faint of heart. As a Buyer you need to look deep within and ask yourself are you willing and in a position to be able to do what it takes to win a home. If you are looking for a deal or hoping to go under list price, this is not the right market for you and it might be prudent to sit this out until the market balances out or turns in your favor. There are always corner cases, but rare at this very moment. The comparable market data must be analyzed with a grain of salt. The data is 2 to 3 months behind and the market has been increasing week by week. The latest information is key in this market. If you must buy in this market, then you should get in and get out as quickly as you can and allow other Buyers to keep bidding the prices up.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>As a Buyer How Do I Win?<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">First, having an experienced Real Estate team as your guide is critical to your success. Secondly, we have broken this down to the winning formula below.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Winning Offer = Price (Factoring Past Comparables + Most Recent Sales (if any) + Number of Offers + Level of Aggression from Other Buyers) + Strong Terms + Strong Down Payment + Terms Unique to This Seller + Complete Offer Package + Solid Agent + Solid Loan Agent<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">In the end there is no formula when it comes to the emotions of a Buyer and their families. Buyers are ignoring the comparable market data and bidding their maximum willingness to pay. Each Buyer should ensure that they have a strong cash position in case of any appraisal deltas which is a major risk in this market. See my previous blog on how this works or reach out to us so that we can show you in detail <a href="https://www.linkedin.com/pulse/how-loans-appraisals-down-payments-deposits-intertwined-alan-wang/" style="color: #954f72;">https://www.linkedin.com/pulse/how-loans-appraisals-down-payments-deposits-intertwined-alan-wang/</a>. If you do not have sufficient buffer for appraisals, you should lower your price point or sit out of this market unless you find a corner case opportunity. You could also shift to Townhomes or Condominiums where it is not as competitive.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Seller Advice<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">If you are the owner of a Single-Family Home the market has never been more on your side. We never know when things will change in the market or the economy, if you plan to move, we know that at this very moment this is an excellent time as any. For those of you in the Townhome and Condominium sector, we will have to analyze your area and complex to see if there is an opportunity there.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Looking Ahead<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">There is certainly more optimism and a light at the end of the tunnel with the rollout of the vaccine. This is better news than we have had for all of 2020. Housing will likely continue to be an essential part of our lives. As long as all the factors driving the demand remains constant, 2021 will continue to a strong Sellers’ market on fire.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Feeling Social?</b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Join the conversation on Linkedin <a href="https://www.linkedin.com/pulse/march-2021-silicon-valley-real-estate-update-market-alan-wang/">https://www.linkedin.com/pulse/march-2021-silicon-valley-real-estate-update-market-alan-wang/</a></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">For a personal consultation call or text us at (408)313-4352 or e-mail us at <a href="mailto:alan@alanwangrealty.com">alan@alanwangrealty.com</a></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><span style="background-color: white; caret-color: rgba(0, 0, 0, 0.6); font-size: 12px; text-align: center;">Photo Credit - https-/upswingpoker.com/poker-chip-values</span></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><br /></p>Unknownnoreply@blogger.com28Los Altos, CA, USA37.3852183 -122.11412989.0749844638211528 -157.2703798 65.695452136178844 -86.9578798tag:blogger.com,1999:blog-6677356073587079062.post-58708414891415351462021-01-03T17:18:00.007-08:002021-01-03T17:18:49.544-08:002020 Silicon Valley Real Estate Year in Review<p align="center" class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in; text-align: center;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">We all know that 2020 has been one of the most challenging years in history due to the COVID-19 pandemic. We hope that you and your family had a safe holiday and continue to do our part and Shelter-in-place.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>First Half of 2020<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The first quarter of 2020 kicked off with a strong Sellers’ market across all real estate product categories. The market was shaping up to be a competitive market for Buyers resulting in steady price increases for Sellers. Then Shelter-in-place hit mid-March and real estate came to a grinding halt for a little over a month. Realtors were not considered essential at first and there was much confusion on how real estate would be sold. By May, Realtors were made essential and we had a procedure on how to show homes safely paired with an understanding from the industry as how to show and close transactions in a safe manner.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>Latter Half of 2020<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Consumer preferences shifted quickly. First, there was an exodus from the Bay Area especially from downtown city centers such as San Francisco and San Jose. The justification of high prices living in a downtown, when residents are not able to enjoy what a city center offers, made it a simple decision for many to move. Available rental units increased quickly, and rental rates dropped and are still at bargain prices.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">The second trend was a migration to the suburbs in the Peninsula, Southbay and even more flocked to the East Bay. With remote work being the norm for the near future, Buyers have flocked further from center for more affordable areas in exchange for larger homes, good schools at a lower cost.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Thirdly, Buyers have steered away from Condominium and Townhomes, while Single-Family Homes are in very short supply. Multiple offers abound for Single-Family Homes and be ready to compete with heavy competition in most areas. For Buyers, the deals will likely continue for Condominiums and Townhomes especially in San Francisco. If you are a Seller of a Single-Family Home, the market is on your side. If you are looking to sell a Condominium or Townhome, the property will sell but patience is warranted.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">Lastly, Buyers are looking for move-in ready homes, larger size homes with more space, more rooms for a home office and a yard for the children to enjoy.<o:p></o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><o:p> </o:p></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b>2021 Projections and Beyond<o:p></o:p></b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;"><b> </b></p><p class="MsoNormal" style="font-family: Calibri, sans-serif; margin: 0in;">2021 looks to be the same narrative as the latter half of 2020 and not likely to change. Single-Family Homes will continue to be in short supply and multiple offers will continue in most areas. Townhomes and Condominiums will likely continue to struggle unless we get back to some semblance of normalcy in 2021. All eyes will be on the effectiveness of the vaccine and overall rollout. All signs point to slow progress and we expect the majority of 2021 to be similar to latter half of 2020. We wish you and your family a better 2021 and please let us all stay vigilant and stay safe.<o:p></o:p></p>Unknownnoreply@blogger.com40tag:blogger.com,1999:blog-6677356073587079062.post-16928593040124322092020-11-25T23:16:00.007-08:002020-11-29T13:40:28.364-08:00 Post-Election and California Propositions Real Estate Impact<p class="MsoNormal" style="font-size: medium; text-align: center;"><span style="text-align: left;">The elections and California propositions bring some changes ahead in the area of real estate and other areas will remain much the same.</span></p><p class="MsoNormal" style="font-size: medium; text-align: center;"><span style="text-align: left;"><br /></span></p><p class="MsoNormal" style="font-size: medium; text-align: center;"><span style="text-align: left;"><b>Video Link</b></span></p><p class="MsoNormal" style="font-size: medium; text-align: center;"><span style="text-align: left;"><b><br /></b></span></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><iframe allowfullscreen="" class="BLOG_video_class" height="266" src="https://www.youtube.com/embed/nMzUDf3IKVc" width="320" youtube-src-id="nMzUDf3IKVc"></iframe></div><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"><b>Slide Show Links - </b><a href="https://www2.slideshare.net/AlanWang6/november-2020-real-estate-update-presidential-elections-and-california-propositions" target="_blank">https://www2.slideshare.net/AlanWang6/november-2020-real-estate-update-presidential-elections-and-california-propositions </a></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"><b>Presidential Election</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">We do not see many changes in the short run that will have a direct impact on the area of real estate. With the government working to provide necessary stimulus as we try to sustain and recover from the pandemic, one of the key areas of focus will be to ensure that Americans have the ability to pay their rents and mortgages. This will keep interest rates low for the foreseeable future and hopefully provide enough relief paired with forbearance to keep foreclosures from happening. Currently, there is a shortage of real estate especially in the area of Single-Family Homes, but at risk are Condominiums in metropolitan cities and Townhomes as well.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"><b>California Propositions</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">There were a few propositions that were focused on Real Estate on the California ballot.</p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Propositions 15 and 21 - Defeated</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="margin-left: 0.5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -0.25in;"><!--[if !supportLists]--><span style="font-family: "Wingdings 3"; mso-bidi-font-family: "Wingdings 3"; mso-fareast-font-family: "Wingdings 3";">u<span style="font-family: "Times New Roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span></span><!--[endif]-->Proposition 15 – Change in Commercial Property Tax – “Taxes such properties based on current market value, instead of purchase price. Fiscal Impact: Increased property taxes on commercial properties worth more than $3 million providing $6.5 billion to $11.5 billion in new funding to local governments and schools.”</p><p class="MsoNormal" style="margin-left: 0.5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -0.25in;"><br /></p><p class="MsoNormal" style="margin-left: 0.5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -0.25in;"><!--[if !supportLists]--><span style="font-family: "Wingdings 3"; mso-bidi-font-family: "Wingdings 3"; mso-fareast-font-family: "Wingdings 3";">u<span style="font-family: "Times New Roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span></span><!--[endif]-->Proposition 21 - Local Government Rent Control – “Allows local governments to establish rent control on residential properties over 15 years old. Local limits on rate increases may differ from statewide limit. Fiscal Impact: Overall, a potential reduction in state and local revenues in the high tens of millions of dollars per year over time. Depending on actions by local communities, revenue losses could be less or more.”<o:p></o:p></p><p class="MsoNormal" style="margin-left: 0.5in; mso-list: l0 level1 lfo1; tab-stops: list .5in; text-indent: -0.25in;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b>Proposition 19 – Passed - Impact on Seniors and Transfer of Real Estate</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">“Allows homeowners who are over 55, disabled, or wildfire/disaster victims to transfer primary residence’s tax base to replacement residence. Changes taxation of family-property transfers. Establishes fire protection services fund. Fiscal Impact: Local governments could gain tens of millions of dollars of property tax revenue per year, probably growing over time to a few hundred million dollars per year. Schools could receive similar property tax gains”<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;">This is the proposition that has the most impact on our local real estate market. The focus was upon those that were impacted by wildfires so that they could transfer their property taxes. However, lumped in this proposition is more flexibility for seniors with their property taxes and also changes to how inherited properties are handled.</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b><i>Tax Base Transfer for Owners 55 Years and Older</i></b></p><p class="MsoNormal" style="font-size: medium;"><b><i><br /></i></b></p><p class="MsoNormal" style="font-size: medium;">In years prior, a senior over 55 transferring their property tax was allowed a one-time transfer, limited to 10 counties and there were value limits usually forcing the owner to trade down mostly.</p><p class="MsoNormal" style="font-size: medium;">With the passage of Proposition 19, seniors can now transfer their tax base up to three times, move to a county anywhere in the state of California and a home of any value can be purchased with adjusted transferred values if the price is over 100% of their departing home sale price.</p><p class="MsoNormal" style="font-size: medium;">These rules will come into effect on April 1, 2021.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;">Here is an informative chart from the Board of Equalization:</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-LJd5TYb_7Xo/X79V1i7yW6I/AAAAAAAAMds/-UNa663VCvkLIWFKX-0tbx1uorfKL7pzgCLcBGAsYHQ/s1187/Base%2BYear%2BValue%2BTransfer.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="1187" data-original-width="977" height="320" src="https://1.bp.blogspot.com/-LJd5TYb_7Xo/X79V1i7yW6I/AAAAAAAAMds/-UNa663VCvkLIWFKX-0tbx1uorfKL7pzgCLcBGAsYHQ/s320/Base%2BYear%2BValue%2BTransfer.png" /></a></div><p></p><p class="MsoNormal" style="font-size: medium; text-align: center;">Source - <a href="https://boe.ca.gov/prop19/">https://boe.ca.gov/prop19/</a></p><p class="MsoNormal" style="font-size: medium; text-align: center;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b>Property Tax Transfer to a Child or Grandchild</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">In the past properties that were transferred to a child or grandchild, the property taxes were allowed to carryover and there was a $1,000,000 limit no matter what type of property.</p><p class="MsoNormal" style="font-size: medium;">With the passage of Proposition 19 there is a limit to the value (current taxable value plus $1M) and also this transfer will only apply to the primary home of the deceased. It is assumed that they Child or Grandchild will reside in the home to maintain lower property taxes.</p><p class="MsoNormal" style="font-size: medium;">These rules will come into effect February 16, 2021.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;">Another informative chart from the Board of Equalization:</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-QZ-yYe5CASo/X79WB61oaQI/AAAAAAAAMdw/PKu1y_9lbbg9G42Y4ubAL13iNxIjbbCqACLcBGAsYHQ/s983/Parent-Child%2BExclusion.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="983" data-original-width="977" height="320" src="https://1.bp.blogspot.com/-QZ-yYe5CASo/X79WB61oaQI/AAAAAAAAMdw/PKu1y_9lbbg9G42Y4ubAL13iNxIjbbCqACLcBGAsYHQ/s320/Parent-Child%2BExclusion.png" /></a></div><p class="MsoNormal" style="font-size: medium; text-align: center;">Source - <a href="https://boe.ca.gov/prop19/">https://boe.ca.gov/prop19/</a></p><p class="MsoNormal" style="font-size: medium; text-align: center;"><br /></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Conclusion<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">Overall, the expansion of property tax options to seniors giving more flexibility is a positive and also allows more revenue to the state in certain scenarios. Limiting the property transfer base to children and grandchildren although not ideal for the surviving family, allows more revenue to the state. In reality the family inheriting a property in our area will be at excellent prices, to pay the property taxes seems only fair. Of course, they could choose to sell the property and they still have a step-up basis in taxes if they choose not to keep the property.</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Contact Us</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">Real Estate is complex and tailored to each family’s unique scenarios. For a planning meeting please call or text Alan at (408)313-4352 or e-mail me at <a href="mailto:alan@alanwangrealty.com">alan@alanwangrealty.com</a> so that we can build a strategy unique to you and your family!</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b>Disclaimer<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;">We are not experts in tax law or estate planning. You are highly recommended to talk to your Tax and Estate Planners or Lawyers to see how these propositions affect you and your family directly.</p><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b>Credits</b></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoListParagraphCxSpFirst" style="mso-list: l1 level1 lfo2; text-indent: -0.25in;"><!--[if !supportLists]-->-<span style="font-family: "Times New Roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span><!--[endif]-->All descriptions in “quotes” are from the California Secretary of State, California General election November 3, 2020 Official Voter Information Guide <a href="https://voterguide.sos.ca.gov/propositions/">https://voterguide.sos.ca.gov/propositions/</a><o:p></o:p></p><p class="MsoListParagraphCxSpLast" style="mso-list: l1 level1 lfo2; text-indent: -0.25in;"><!--[if !supportLists]-->-<span style="font-family: "Times New Roman"; font-size: 7pt; font-stretch: normal; line-height: normal;"> </span><!--[endif]-->Board of Equalization Summary Charts for Proposition 19 - <a href="https://boe.ca.gov/prop19/">https://boe.ca.gov/prop19/</a></p><br />Unknownnoreply@blogger.com17tag:blogger.com,1999:blog-6677356073587079062.post-22229398915507077112020-10-06T09:00:00.003-07:002020-10-06T09:00:33.851-07:002020 Curveballs and Impact to Silicon Valley Real Estate<p><span style="font-family: Calibri, sans-serif;">First of all, apologies for not getting the second quarter blog out to you. We are honored by so many of you asking us about the blog and that so many of you read our quarterly updates. This update will encompass the second and third quarter update of 2020.</span></p><p><span style="font-family: Calibri, sans-serif;"><b>Other Content Mediums</b></span></p><div class="separator" style="clear: both; text-align: center;"><iframe allowfullscreen="" class="BLOG_video_class" height="266" src="https://www.youtube.com/embed/ppAhZzZ2Y7M" width="320" youtube-src-id="ppAhZzZ2Y7M"></iframe></div><div class="separator" style="clear: both; text-align: center;"><ul><li style="text-align: left;">Video - For those of you that prefer video here is a video summary of our blog</li><li style="text-align: left;">Slides - The slides are available at Slideshare - <span style="font-family: Calibri, sans-serif; font-size: 12pt;"><a href="https://www.slideshare.net/AlanWang6/2020-curveballs-and-impact-on-silicon-valley-real-estate" target="_blank">https://www.slideshare.net/AlanWang6/2020-curveballs-and-impact-on-silicon-valley-real-estate</a></span></li><li style="text-align: left;">Linkedin - Join the conversation on Linkedin! - <span style="font-family: Calibri, sans-serif; font-size: 12pt;"><a data-cke-saved-href="https://www.linkedin.com/pulse/2020-curveballs-impact-silicon-valley-real-estate-alan-wang" href="https://www.linkedin.com/pulse/2020-curveballs-impact-silicon-valley-real-estate-alan-wang" target="_blank">https://www.linkedin.com/pulse/2020-curveballs-impact-silicon-valley-real-estate-alan-wang</a></span></li></ul></div><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>2020 Challenges-to-Date<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">The year 2020 could not be over soon enough. The challenges we have faced as a society we have never been seen in our lifetimes. We are fighting challenges on multiple fronts; first with the threat of coronavirus still looming, learning how to shelter in place with our families and many with children of all ages, learning to cope with online schooling, social distancing in public areas, local businesses fighting for survival, social unrest in many parts of the country, a country divided on many issues and in the last month wild fires across our state creating unhealthy conditions outdoors further trapping us in our homes not to mention those that have lost their homes. Despite all of these challenges, residential real estate continues to boom in certain sectors while struggling in others. This article will explain in depth the various phenomenon’s that we are seeing.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>A Momentary Freeze<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><br />When the Shelter-in-place ordinances were announced, all of us were extremely concerned about what would become of the real estate market. In fact, Realtors were not considered essential at the onset although Banks and Title Companies were. In March and April all activities mostly grinded to a halt, except for those Sellers or Buyers who were already in contract.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Temporary Halt of the “City Center”</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">Traditionally, societies around the world revolved around major metropolitan cities and in our area that is pre-dominantly the city of San Francisco. People flocked to San Francisco due to its’ historical ambience and character, multiple night life and entertainment options, an abundance of jobs and career opportunities. These characteristics drove down the supply of housing, confined people to smaller spaces, pushed rental rates as well as home prices upward. When the Shelter-in-Place ordinances were put in place and companies were forced to allow employees to work from home, the justification to live in confined spaces at high prices were no longer justified when people could no longer enjoy all that San Francisco had to offer. Without the nightlife, enjoyment of the outdoors and the need to go to work, people left San Francisco in droves quickly.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Out of State Migrations and San Francisco<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">The first group to leave the area were individuals or young couples that weren’t from the area to begin with. Their reasons were simple, move back home to their families as their jobs no longer required them to live in the high-priced Bay Area and therefore they were saving money on high rents in the area. There was simply no need to physically be in the Silicon Valley and remote work options were always a part of the foundation of the tech sector. The impact of this has hit the San Francisco housing market especially hard. Moving trucks were seen throughout San Francisco and landlords have been forced to compete with a sudden influx of rental properties thereby driving down the rental rates in an effort to fill their vacancies and stop the loss of cash flow on their investments. Homes sales especially for Condominiums and Townhomes had a major increase in inventory causing home prices in both of those sectors to drop. Buyers suddenly had an overwhelming amount of choices and it really boiled down to price as the key differentiator. The Mercury News reported “<span style="background-color: white; letter-spacing: -0.1pt;">Monthly rent dropped 17.8 percent in San Francisco, the steepest decline in the nation, 9.5 percent in San Jose, 7.9 percent in Oakland and 6.3 percent in Fremont” – Source Mercury News Louis Hansen - 10/1/2020 - </span><a href="https://www.mercurynews.com/2020/10/01/rent-falling-fast-in-bay-area-cities-during-pandemic/"><span style="background-color: white; background-position: initial initial; background-repeat: initial initial; letter-spacing: -0.1pt;">https://www.mercurynews.com/2020/10/01/rent-falling-fast-in-bay-area-cities-during-pandemic/</span></a><span style="background-color: white; letter-spacing: -0.1pt;">. Leveraging Supply and Demand curves, let’s take a look at what happened.</span><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 1a – San Francisco Supply and Demand Pre-Covid<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><v:shapetype coordsize="21600,21600" filled="f" id="_x0000_t75" o:preferrelative="t" o:spt="75" path="m@4@5l@4@11@9@11@9@5xe" stroked="f"><v:stroke joinstyle="miter"><v:formulas><v:f eqn="if lineDrawn pixelLineWidth 0"><v:f eqn="sum @0 1 0"><v:f eqn="sum 0 0 @1"><v:f eqn="prod @2 1 2"><v:f eqn="prod @3 21600 pixelWidth"><v:f eqn="prod @3 21600 pixelHeight"><v:f eqn="sum @0 0 1"><v:f eqn="prod @6 1 2"><v:f eqn="prod @7 21600 pixelWidth"><v:f eqn="sum @8 21600 0"><v:f eqn="prod @7 21600 pixelHeight"><v:f eqn="sum @10 21600 0"></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:f></v:formulas><v:path gradientshapeok="t" o:connecttype="rect" o:extrusionok="f"><o:lock aspectratio="t" v:ext="edit"></o:lock></v:path></v:stroke></v:shapetype><v:shape alt="Chart, line chart, scatter chart
Description automatically generated" id="Picture_x0020_1" o:spid="_x0000_i1035" style="height: 261pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Chart, line chart, scatter chart
Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image001.png"></v:imagedata></v:shape><o:p></o:p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-RC2b36IgJTc/X3yTITqOS3I/AAAAAAAAMXE/8q41wQ6ERucN9WkWG4hW8JpvrZ2S-8xHwCLcBGAsYHQ/s1058/73e49329-e899-45bc-b3c0-5983ed9d1ce1.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="591" data-original-width="1058" height="224" src="https://1.bp.blogspot.com/-RC2b36IgJTc/X3yTITqOS3I/AAAAAAAAMXE/8q41wQ6ERucN9WkWG4hW8JpvrZ2S-8xHwCLcBGAsYHQ/w400-h224/73e49329-e899-45bc-b3c0-5983ed9d1ce1.png" width="400" /></a></div><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 1b – Migration Out of San Francisco Caused a Reduction in Rental and Home Prices<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><v:shape alt="Chart, line chart
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Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image003.png"></v:imagedata></v:shape><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p><b>Government Stimulus and Interest Rates</b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">The government acted swiftly to initiate The Cares Act with programs such as the Payroll Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) for small businesses. Although not all businesses were able to get these funds many did. A new concept called forbearance granted relief for a homeowner or landlord from having to pay their mortgage or at a lower rate. Many states, cities and counties initiated tenant payment relief programs as well. Last but not least, extra stimulus payments for qualified earners and additional unemployment benefits helped to keep families afloat.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">The Federal Reserve having learned from the last downturn, acted very quickly in dropping interest rates to zero and adding more liquidity to the financial system. What resulted was yet again the lowest interest rates ever seen especially for mortgages.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 2 – 30 Year Fixed Mortgage Rates</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-8TtdQ3rWjxw/X3yTzpxCeAI/AAAAAAAAMX8/ECrZy1O0C1U_fgl8YoCRCOEFuhc7Ww7YACLcBGAsYHQ/s962/9b89bb07-a8d0-45bd-a666-0315ab7f1361.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="392" data-original-width="962" height="163" src="https://1.bp.blogspot.com/-8TtdQ3rWjxw/X3yTzpxCeAI/AAAAAAAAMX8/ECrZy1O0C1U_fgl8YoCRCOEFuhc7Ww7YACLcBGAsYHQ/w400-h163/9b89bb07-a8d0-45bd-a666-0315ab7f1361.png" width="400" /></a></div><p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><v:shape alt="Graphical user interface, chart, application, line chart
Description automatically generated" id="Picture_x0020_5" o:spid="_x0000_i1032" style="height: 191pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Graphical user interface, chart, application, line chart
Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image004.png"></v:imagedata></v:shape><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;">Source Freddie Mac - <a href="https://fred.stlouisfed.org/graph/?g=NUh">https://fred.stlouisfed.org/graph/?g=NUh</a><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Technology, Finance and Medical Sectors<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><p class="MsoNormal" style="font-size: medium;">We are certainly mindful of small business owners/workers that are having the toughest time during this pandemic. Many small businesses and franchisees have shuttered their businesses unable to continue during the strict restrictions as we continue to shelter-in-place. Consumers have been hesitant to return to dining and multiple businesses still remain closed although local counties are attempting to re-open. Even outdoor dining still equates to limited capacity and reduced revenue for local business owners. California’s unemployment rate went from 3.9%, peaked at 16.4% and is currently settling at 11.4% for the month of August. The impact of the coronavirus pandemic is simply staggering.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 3 - State of California Unemployment Rates</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><br /></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-Q39YHLrHeKw/X3yT68t5PJI/AAAAAAAAMYE/f05rVa9aF2U5iHQcsJLmA-p48NT0YbQ-wCLcBGAsYHQ/s491/08c8738a-9bfb-437c-bc8a-c9eff0cd2c34.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="278" data-original-width="491" height="226" src="https://1.bp.blogspot.com/-Q39YHLrHeKw/X3yT68t5PJI/AAAAAAAAMYE/f05rVa9aF2U5iHQcsJLmA-p48NT0YbQ-wCLcBGAsYHQ/w400-h226/08c8738a-9bfb-437c-bc8a-c9eff0cd2c34.png" width="400" /></a></div><br /><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-lVIh_6CgpfM/X3yT-YTx3BI/AAAAAAAAMYM/vHieoJvMswUichvc7TwG3pyDHjvw9ifgACLcBGAsYHQ/s825/50f79540-0778-4b4e-b9ac-5f86de291c06.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="382" data-original-width="825" height="185" src="https://1.bp.blogspot.com/-lVIh_6CgpfM/X3yT-YTx3BI/AAAAAAAAMYM/vHieoJvMswUichvc7TwG3pyDHjvw9ifgACLcBGAsYHQ/w400-h185/50f79540-0778-4b4e-b9ac-5f86de291c06.png" width="400" /></a></div><p class="MsoNormal" style="font-size: medium;"><v:shape alt="Chart, line chart
Description automatically generated" id="Picture_x0020_12" o:spid="_x0000_i1031" style="height: 139pt; visibility: visible; width: 245pt;" type="#_x0000_t75"><v:imagedata o:title="Chart, line chart
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Description automatically generated" id="Picture_x0020_11" o:spid="_x0000_i1030" style="height: 191pt; visibility: visible; width: 412pt;" type="#_x0000_t75"><v:imagedata o:title="Table
Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image006.png"></v:imagedata></v:shape><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">Source – US Bureau of Statistics -<a href="https://data.bls.gov/timeseries/LASST060000000000003?amp%253bdata_tool=XGtable&output_view=data&include_graphs=true">https://data.bls.gov/timeseries/LASST060000000000003?amp%253bdata_tool=XGtable&output_view=data&include_graphs=true</a><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">There is one bright spot in this news, key Silicon Valley skilled industries such as the Technology, Finance, Medical, Legal, Construction, sectors of the Real Estate industry continue to thrive despite the pandemic.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>NASDAQ<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">The technology heavy NASDAQ took a major hit when the pandemic came to bear in March. There was widespread panic across the board. Defying all odds the NASDAQ has now recovered to record levels even pre-covid. This is important for our local home buyers as this is the source of the down payments for their homes.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 4 – NASDAQ Index Last Two Years</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-qw7PNKY50fI/X3yUG8c8qiI/AAAAAAAAMYQ/0llvIF6DXvIQBGWqbbMH-lu_50Ro3cKIgCLcBGAsYHQ/s1247/69d4349c-0ec4-4ce3-ac11-d5eadbad1b7f.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="940" data-original-width="1247" height="301" src="https://1.bp.blogspot.com/-qw7PNKY50fI/X3yUG8c8qiI/AAAAAAAAMYQ/0llvIF6DXvIQBGWqbbMH-lu_50Ro3cKIgCLcBGAsYHQ/w400-h301/69d4349c-0ec4-4ce3-ac11-d5eadbad1b7f.png" width="400" /></a></div><p></p><p class="MsoNormal" style="font-size: medium;"><v:shape alt="Chart, line chart
Description automatically generated" id="Picture_x0020_2" o:spid="_x0000_i1029" style="height: 353pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Chart, line chart
Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image007.png"></v:imagedata></v:shape><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">Source – Verizon/Yahoo Finance! – 10/2/2020<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>New Requirements in New Times<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><p class="MsoNormal" style="font-size: medium;">For most families, none had planned to be in their homes with their spouses, children and work 24 hours a day. For most families our days were spent working, driving children to school or day care, enjoying the outdoors, partaking in night life, attending children’s sports and other activities and traveling. Suddenly every home buyer came to us with four key requirements; more living space, more bedrooms to accommodate at least one office, a good size backyard especially for those families with children and lastly a move-in ready home. The key product segment that fulfills this requirement is the traditional Single Family Home which has seen a major increase in demand. Condominiums and Townhomes on the other hand are sitting longer on the market if they sell at all. This is simply not the product segment that people need at this time in their lives.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>The Flight South East<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><p class="MsoNormal" style="font-size: medium;">As the migration out of San Francisco occurred, Bay Area residents flocked to the suburbs desperately looking for that space and a yard. In the past, hot markets were defined as flights towards the city centers for the first time we have a flight away. One factor is abundantly clear, housing is an essential need and which is why real estate is in fact booming. Cities in the past that were considered far for most Buyers are seeing multiple offers. Some examples of heavy competition are taking place in Pleasanton, Dublin, San Ramon, Danville and Morgan Hill. Homes are selling before Buyers can get there on the weekend to see the home. Essentially all markets with Single Family Home inventory are seeing a hot market.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 5a – Supply and Demand of Single Family Homes Pre-covid<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-mazBWwXF_xw/X3yUNaFgl6I/AAAAAAAAMYY/uNCuCVB9l6wwp-5rNjCG4IYlES73cqbRwCLcBGAsYHQ/s1016/c362fb1d-e27d-4dcf-9e00-1f9d8a7c45e9.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="601" data-original-width="1016" height="236" src="https://1.bp.blogspot.com/-mazBWwXF_xw/X3yUNaFgl6I/AAAAAAAAMYY/uNCuCVB9l6wwp-5rNjCG4IYlES73cqbRwCLcBGAsYHQ/w400-h236/c362fb1d-e27d-4dcf-9e00-1f9d8a7c45e9.png" width="400" /></a></div><p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 5b – Reduction in Supply Caused and Increase in Prices</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-5lRKqDOMIOU/X3yUTp_LJqI/AAAAAAAAMYg/cBfxe7saCfgGQC2ZwA8J8mwYHbWVfX0YwCLcBGAsYHQ/s1014/f672b78b-667f-45af-86b9-195510311f60.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="523" data-original-width="1014" height="206" src="https://1.bp.blogspot.com/-5lRKqDOMIOU/X3yUTp_LJqI/AAAAAAAAMYg/cBfxe7saCfgGQC2ZwA8J8mwYHbWVfX0YwCLcBGAsYHQ/w400-h206/f672b78b-667f-45af-86b9-195510311f60.png" width="400" /></a></div><p></p><p class="MsoNormal" style="font-size: medium;"><b><v:shape alt="Chart, diagram, radar chart
Description automatically generated" id="Picture_x0020_9" o:spid="_x0000_i1027" style="height: 241pt; visibility: visible; width: 468pt;" type="#_x0000_t75"><v:imagedata o:title="Chart, diagram, radar chart
Description automatically generated" src="file:////Users/alanlwang/Library/Group%20Containers/UBF8T346G9.Office/TemporaryItems/msohtmlclip/clip_image009.png"></v:imagedata></v:shape><o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 5c – Increase in Demand Due to Shelter-in-Place Further Increased Prices</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-E6kU5yKGhTA/X3yUZNpzeSI/AAAAAAAAMYk/Sz_WKUrVBJYdmiJs8i1jo9jX2zICJzhPQCLcBGAsYHQ/s1035/40d13c82-baeb-40ab-9a76-b7c4ebf9f2e5.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="519" data-original-width="1035" height="200" src="https://1.bp.blogspot.com/-E6kU5yKGhTA/X3yUZNpzeSI/AAAAAAAAMYk/Sz_WKUrVBJYdmiJs8i1jo9jX2zICJzhPQCLcBGAsYHQ/w400-h200/40d13c82-baeb-40ab-9a76-b7c4ebf9f2e5.png" width="400" /></a></div><br /><p class="MsoNormal" style="font-size: medium;"><br /></p><p class="MsoNormal" style="font-size: medium;"><b>State of the Market</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">Fueled by a strong job market at skilled positions, a rising stock market, low interest rates, combined with the desperate need for more indoor and exterior living space; these factors have driven the Single Family home market into low supply and high demand across most cities in the Silicon Valley and across the nation and created heavy competition across the board. Condominiums are the hardest hit sector following by Townhomes especially in San Francisco and Commercial real estate has been impacted as well.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;">Taking Santa Clara County as an example let us take a look at the Single Family Home sector. Inventory has stayed more or less the same however homes are taking longer to sell than last year. This is not surprising given that there is more friction with the home showing process with waiver, forms, booking times and and also the desire of Buyers to have a move-in ready home. What is very interesting are the pending and sold units are overtaking the active homes on the market. What that means is that the demand is extremely strong in this sector. The homes that are selling are selling 29% faster than they were last year. Homes that are priced right and are in move-in ready condition tend to fly off the market. The Condominium and Townhome market tells a slightly different story. Inventory is up 35% from a year ago and the days on the market have increased as well. As mentioned this not the product group that folks are flocking to during the pandemic however the pending and sold units seem to have been picking up momentum though not as aggressive at least in the southbay.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;"><b>Exhibit 6 - Q3 2020 Santa Clara County Snapshot</b><o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><b><br /></b></p><p class="MsoNormal" style="font-size: medium;"></p><div class="separator" style="clear: both; text-align: center;"><a href="https://1.bp.blogspot.com/-Ei8kfvSVMxg/X3yUfkaaGDI/AAAAAAAAMYs/ajeI26WM3joKVe_mEhLIg0zuEG-o9FUgACLcBGAsYHQ/s1917/1cbbc5d3-5fd5-4762-a7ff-c3e58d933cea.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="1113" data-original-width="1917" height="233" src="https://1.bp.blogspot.com/-Ei8kfvSVMxg/X3yUfkaaGDI/AAAAAAAAMYs/ajeI26WM3joKVe_mEhLIg0zuEG-o9FUgACLcBGAsYHQ/w400-h233/1cbbc5d3-5fd5-4762-a7ff-c3e58d933cea.png" width="400" /></a></div><br /><p></p><p class="MsoNormal" style="font-size: medium;"><b>Real Estate Outlook 2020 and Beyond<o:p></o:p></b></p><p class="MsoNormal" style="font-size: medium;"><b> </b></p><p class="MsoNormal" style="font-size: medium;">Companies are allowing workers to work from home until at least June of 2021. Even if employees were permitted to return to work, they will most likely be in a hybrid model first, before having to go back into the office full time. This is all dependent on the status of a vaccine and how the overall coronavirus numbers are trending. 2021 will likely be certainly more than half time at home and indoor and outdoor space will continue to be a premium. Single Family homes will continue to be in high demand while the Condominium and Townhome sector may or may not be on a road to recovery in 2021. There are certainly multiple dependencies before we get back to normalcy.<o:p></o:p></p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><p class="MsoNormal" style="font-size: medium;">We are living in a unique location where jobs are secure overall fueled especially by the tech sector and those have always been the demographic of people buying homes. I anticipate interest rates to continue to stay low and if the NASDAQ holds at current values or continues its’ upward trend, home prices will continue on that trend as well. The two key variables are the upcoming election and the health of the rest of the nation. The big question is will monetary policy change due to the next president and although we live in a unique place, the health of the rest of the nation should be monitored. If the rest of the nation falls into a recession, then even the mighty Silicon Valley could be impacted and that may slow down this strong real estate market.</p><p class="MsoNormal" style="font-size: medium;"><o:p> </o:p></p><style class="WebKit-mso-list-quirks-style">
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</style>Unknownnoreply@blogger.com10tag:blogger.com,1999:blog-6677356073587079062.post-20202395743107359312020-03-15T11:42:00.002-07:002020-03-15T11:45:13.845-07:00Q1 2020 Real Estate Review - Coronavirus and Real Estate<div dir="ltr" style="text-align: left;" trbidi="on">
At first glance, the Coronavirus and Real Estate have very little in common. The coronavirus is an un-precedented global health pandemic with the situation seemingly escalating by the week locally and globally. First and foremost, please keep you and your families safe. In the long run, we as a society will overcome this, however in the short run this will not only disrupt our lives, but the situation will also have a major impact to all parts or our local, domestic and global economies. Of the most concern, is how quickly things have changed literally in the last 2 weeks. The stock market has lost over 20%, throwing our bull market into a bear market. Workplaces have mostly asked employees to work from home, schools have been canceled anywhere from 2 to 4 weeks, mass gatherings have been almost eliminated and we are on the brink of a lock down.<br />
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<b>The Market Prior to March 2020</b><br />
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Prior to March of 2020, the real estate market told a different tale. Closing out 2019, the Federal Reserve cut interests rates for the 3rd time. This rate adjustment got Buyers who were in discount mode, out in droves as they fought for seasonally low winter inventory. This momentum carried into the spring of 2020 as Sellers once again had multiple offers and some areas were close to wiping out their losses during the real estate market correction of 2018 to 2019. Inventory continued to be low and bidding wars continued for the months of January and February.<br />
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<b>The March Avalanche</b><br />
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In the first week of March, the first indications of the coronavirus began to appear with many cases in Santa Clara County. The stock market dropped on the uncertainty and the federal reserve acted quickly by dropping rates by a half point. By the second week, the World Health Organization declared this as a pandemic and the stock markets continued to fall and more drops could be coming.<br />
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<b>Real Estate Going Forward</b><br />
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In the short run, there should be enough momentum from this prior group of Buyers for a short period of time. Many in this last group have already liquidated their assets and have been bidding and ready to buy. However, given the uncertainty, unknown impact, duration and magnitude of this pandemic, Buyers are quickly getting nervous on multiple fronts. With the volatility of the stock market down from 18% to over 20% at this moment, remember that tech stocks are the key sources of Buyer down payments in the Silicon Valley. This sudden drop will affect Buyers especially here in the Valley in a major way. We are seeing drop-offs of Buyers during our offer reviews on our listings due to the current crisis. Much will depend on how much worse the situation becomes.<br />
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The first scenario is that the situation trends in a positive direction, then the momentum from earlier in the year would lead us into a recovery. Interest rates are at record lows once again and it is very likely that rates could go down further which would be attractive to homebuyers. The second scenario is if we go into lock down; similar to China, Italy and Spain. No rate cut of any kind will help if we end up requiring staying in our homes. If that scenario arises, then the real estate market will come to a screeching halt as with every other part of our economy.<br />
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<b>Buyer/Seller Advice</b><br />
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As a Seller, if the situation improves then we most likely haven’t lost too much momentum from earlier in the year. If we end up trending towards the worst-case scenario, there is possibly a small window to get your home sold, but that window is closing very quickly in the short run.<br />
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As a Buyer at this very moment in time you will likely have fewer competitors than the last 4 months. If you do get into contract, just be cautious that there might be disruptions in the real estate supply chain such as with lenders, appraisals, inspectors, title companies, etc. I would prefer to take advantage of the market to buy if things do get worse, however if the entire supply chain cannot perform their jobs, then it would be very difficult to close a transaction. Cash would be the least dependent scenario, where most everything could be done virtually with very little interaction needed. If there is a Seller that must sell, and you could buy the home virtually, it is possible that a deal could be had.<br />
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Some argue similar to the dot com bust that people flooded to real estate for safety. That is possible, assuming the transaction could be completed virtually which would be difficult in the short run.<br />
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<b>Feeling Social?</b><br />
<br />
Join the Conversation on Linkedin - <a href="https://www.linkedin.com/pulse/q1-2020-real-estate-review-coronavirus-alan-wang/">https://www.linkedin.com/pulse/q1-2020-real-estate-review-coronavirus-alan-wang/</a></div>
Unknownnoreply@blogger.com31tag:blogger.com,1999:blog-6677356073587079062.post-50030163917405287472020-01-22T11:34:00.004-08:002020-01-22T11:35:24.717-08:00My Next Play – Owning a Real Estate Brokerage<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="text-align: left;">It has been six years since I led LinkedIn’s market entry and product launch into China. I was frequently challenged by complex business problems that required sophisticated technical solutions. I enjoyed working with and managing extremely talented, cutting-edge teams paired with complex technical solutions in order to deliver projects and programs under tight timelines. Leaving the Technology sector was a big decision for me after 13 years, but I was in search of more challenges.</span></div>
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<b>Real Estate Industry<o:p></o:p></b></div>
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Real Estate was an industry that I was already working in for over 11 years at the time. I saw an opportunity for innovation in an industry often leveraging legacy processes; not just in technology, but in the area of Agent quality and the overall customer experience. I wake up each and every day driven by the desire to help as many of our customers as I can, and to provide them with a real estate journey filled with trust and integrity, much needed real estate education, strategic planning and a smooth and wonderful customer experience. The last 6 years have been an amazing journey of growth and discovery, both personally and for the business as a whole. I am excited to announce my next play is to continue to build out more high-quality Agents to further define and lead our industry into the next century!<o:p></o:p></div>
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<b>Keller Williams Santa Clara Valley<o:p></o:p></b></div>
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I am pleased to announce that I will be launching a new Keller Williams Brokerage as Founder and Operating Principle, named Keller Williams Santa Clara Valley. <span style="font-family: "arial" , sans-serif; font-size: 11pt;">Before this area was known as the Silicon Valley, the South Bay was called Santa Clara Valley, which pairs nicely as our headquarters is based in Santa Clara as well. We are also exploring future expansion into surrounding areas. Located in the heart of the Silicon Valley, we believe that we provide the optimal location for our Agents to more effectively serve their customers. This new venture will allow us as Agents to further establish high quality Agents in the industry.<o:p></o:p></span></div>
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<b><span style="font-family: "arial" , sans-serif; font-size: 11pt;">Why Keller Williams?<o:p></o:p></span></b></div>
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<span style="font-family: "arial" , sans-serif; font-size: 11pt;">I have explored many brokerages and Keller Williams is still the company that was built by Agents for Agents. This opportunity is a prime example of a company that gives their Agents opportunities that I have not seen with any other firm. We don’t brand the company; rather, we allow you as the Agent to brand yourself, subject to the rules of the Department of Real Estate. Their systems and models are pushing the envelope and they have researched and defined not only how to create successful Real Estate Agents, but also to ensure that these agents are financially sound and running profitable businesses. Last but not least, their latest investment in technology is focused upon empowering us as Agents to perform less backend work, and to streamline our processes so that we can do what we do best: Educate, strategize and service our customers. I am proud to be a part of an organization that not only sees the value that each and every one of us brings to our industry but is also working hard to continue pushing us into the future.<o:p></o:p></span></div>
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<b><span style="font-family: "arial" , sans-serif; font-size: 11pt;">Agents - We Are Hiring!<o:p></o:p></span></b></div>
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<span style="font-family: "arial" , sans-serif; font-size: 11pt;">If you or someone you know would like to join us in our newest venture, we are looking to speak with you! Send me a direct message or contact me at (408)313-4352 or e-mail at <a href="mailto:alan@alanwangrealty.com" style="color: #954f72;">alan@alanwangrealty.com</a></span></div>
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<span style="font-family: "arial" , sans-serif; font-size: 11pt;"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;"><br /></a></span></div>
<span style="font-family: times new roman, serif; font-size: 11pt;"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;"><b>Join the Conversation on Linkedin!</b></a></span><br />
<span style="font-family: times new roman, serif; font-size: 11pt;"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;"><br /></a></span>
<span style="font-family: times new roman, serif; font-size: 11pt;"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;" target="_blank">https://www.linkedin.com/pulse/my-next-play-owning-real-estate-brokerage-alan-wang</a></span></div>
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Unknownnoreply@blogger.com37tag:blogger.com,1999:blog-6677356073587079062.post-63131528714593397342020-01-06T05:45:00.003-08:002020-01-06T06:06:06.384-08:002019 Silicon Valley Real Estate Year in Review<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="text-align: left;">We wish you and your families health and prosperity in the new year! This is a time for us to reflect on 2019 and look forward towards 2020 and what real estate adventures await us in the new year.</span></div>
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<b>Q1 2019 – Uncertain Buyers, Uncertain Market<o:p></o:p></b></div>
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2019 started off with major concerns over the health of the real estate market. The latter half of 2018 was the toughest real estate market in a decade-long bull market since the sub-prime meltdown. In the first quarter, that same Buyer sentiment continued as there were few homes being transacted. Buyers had concerns over affordability, the trade war with China and the volatility of the stock market, which took a major hit in December of 2018. Homes were sitting longer on the market with very little showings. Sellers were shocked by this, yet many held onto 2018 price points and many homes sat on the market and were eventually taken off the market.<o:p></o:p></div>
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<b>Q2 2019 – Stimulus Generates a Positive Reaction<o:p></o:p></b></div>
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In the second quarter, real estate activity started to show signs of life led by an interest rate drop by the Federal Reserve. The two key requirements for Buyers were locations closer to work, paired with areas with excellent school districts, which we define as “Prime Locations.” Prices saw slight drops but held steady in these areas; Buyers had fewer competitors if any at all. Areas that did not fit this template had longer days on market - anywhere from 30 to 45 days or more depending on the Seller’s resolve on the final sale price. If Sellers held onto a price that the market would not pay, they would either continue to sit on the market or take their homes off the market altogether.<o:p></o:p></div>
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The Condominium and Townhome sector has been majorly impacted if the homes are not located in a prime location. There have also been multiple new home construction complexes all around the Bay Area that have flooded the market with inventory. At times they have lowered prices to where it simply made more sense to buy brand new verses a re-sale home on the market. We have been able to negotiate heavily with these new home builders.<o:p></o:p></div>
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<b>Q3 2019 – Momentum Continues with Yet More Stimulus<o:p></o:p></b></div>
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In the third quarter, the Federal Reserve dropped interest rates once again. This stimulus helped to kick off a flurry of refinances as well as lower rates for home purchases. This stimulus helped to get more Buyers out and about, however other than markets in prime locations, these Buyers were looking for deals and many were to be had in the market. Nonetheless there were certainly more Buyers making offers and getting into contract.<o:p></o:p></div>
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<b>Q4 2019 – Even More Stimulus in a Low Inventory market<o:p></o:p></b></div>
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In the fourth quarter, the Federal Reserve dropped rates yet again, kicking off frenzies in certain markets due to the seasonal low inventory in this time in the market. With price reductions and low rates, Buyers continued to buy homes until the holidays came into effect.<o:p></o:p></div>
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<b>Buyer and Seller Advice<o:p></o:p></b></div>
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As a Buyer, much will depend on which market and what category of home you are purchasing. Homes of any category in a prime location will likely come with multiple offers or sell in a short period of time. Single Family Homes outside of a prime location are still desired, and deals could be had depending on the location. It is yet to be seen if Condominiums and Townhomes will see a recovery in 2020. These are prime for a deal for Buyers looking for one.<o:p></o:p></div>
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As a Seller the inverse is true from the Buyers perspective. Pricing is key. If you over price your home, your home will sit with very little showings. The market dictates price and Sellers that continue to hold onto 2018 peak pricing must realize that the peak has passed. This is a reality that Sellers must accept before even considering going on the market. The latest data must be taken into account in your pricing decision. These will vary by home type and location. Homes will sell but not for more than what the market is willing to pay.<o:p></o:p></div>
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<b>2020 Outlook and Beyond<o:p></o:p></b></div>
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The concerns about the China Trade War seem to have subsided as the stock market continues to trend upward. The expectation is that there will be a resolution closer to the election. This concern is now replaced by the uncertainty with Iran and what their next move maybe after the incident in Iraq. For our Silicon Valley economy, the health of the job market continues to be strong, the interest rate stimulus and momentum from 2019 will likely carry forward into 2020. We have yet to see the impact of the Tech IPO’s as some have had mixed results. The major uncertainty will be what happens post-election and will depend on who wins the election. For now, if the majority of factors remain the same, we should have enough momentum to have a stronger market but still a market in equilibrium overall.<br />
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<b>Feeling Social? Join the conversation on Linkedin!<o:p></o:p></b></div>
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<span style="font-size: 12pt;"><a href="https://www.linkedin.com/pulse/2019-silicon-valley-real-estate-year-review-alan-wang" style="color: #954f72;">https://www.linkedin.com/pulse/2019-silicon-valley-real-estate-year-review-alan-wang</a></span><span style="font-family: -webkit-standard;"></span></div>
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Unknownnoreply@blogger.com21tag:blogger.com,1999:blog-6677356073587079062.post-63507206879749637992019-10-07T09:35:00.003-07:002019-10-07T09:41:36.178-07:00Q3 2019 Silicon Valley Real Estate Market Update: Fluctuating Market<div dir="ltr" style="text-align: left;" trbidi="on">
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The third quarter of 2019 has been affected by a combination of seasonality and macroeconomic factors that have caused continual fluctuations in the Real Estate market. The Silicon Valley market has trended toward a more balanced market with a bit more activity this quarter than the second quarter.<o:p></o:p></div>
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<b>Macroeconomy<o:p></o:p></b></div>
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The biggest question weighing on the minds of the consumers is the instability of our political and economic environments; specifically, in regard to the trade war and now the discussion of impeachment. All of these factors are creating instability and volatility in the political and economic outlook.<o:p></o:p></div>
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<b>Interest Rates<o:p></o:p></b></div>
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In response to these concerns and a weakening economy, the Federal Reserve reduced rates for a second time this year and is anticipated to reduce rates once again by the end of the year. This means lower mortgage interest rates are on the horizon; likely even lower than the previous historically low rates.<o:p></o:p></div>
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<b>Equity Markets - Nasdaq Snapshot Q3 2019<o:p></o:p></b></div>
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The NASDAQ index, which is the heart of the down payment of Silicon Valley workers, continues to fluctuate, but overall is trending upward from the lows of December 2018 and June 2019.<o:p></o:p></div>
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<b>Exhibit 1 – NASDAQ Stock Index Year-to-Date 2019<o:p></o:p></b><br />
<a href="https://1.bp.blogspot.com/-otQwmB6i0xg/XZtpdRvKiSI/AAAAAAAACFk/r4DeaqjSN8EynJjmxGSzu-ta4fCZFzKgwCLcBGAsYHQ/s1600/Exhibit%2B1%2B%25E2%2580%2593%2BNASDAQ%2BStock%2BIndex%2BYear-to-Date%2B2019.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="275" data-original-width="468" src="https://1.bp.blogspot.com/-otQwmB6i0xg/XZtpdRvKiSI/AAAAAAAACFk/r4DeaqjSN8EynJjmxGSzu-ta4fCZFzKgwCLcBGAsYHQ/s1600/Exhibit%2B1%2B%25E2%2580%2593%2BNASDAQ%2BStock%2BIndex%2BYear-to-Date%2B2019.jpg" /></a></div>
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<i>Source - Year to Date Yahoo! Finance</i></div>
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<b>Microeconomy<o:p></o:p></b></div>
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The local Silicon Valley economy continues to remain healthy. Unemployment rates in the area are at all-time lows at 2.7% per the Bureau of Labor Statistics. As mentioned, the overall trend of the NASDAQ has been trending upward, though volatile, and if timed correctly can be maximized for liquidity.<o:p></o:p></div>
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<b>Mortgage Rates<o:p></o:p></b></div>
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As a result of the Federal Reserve interest rate reduction, mortgage rates have tumbled to record low rates. For Buyers or Homeowners that are cash heavy or have liquid assets, banks are offering additional drops in the interest rate if those assets are brought under their umbrellas. There was a flood of refinance activity that banks did not have the capacity to service which has bogged down the purchase turn times as well. This situation is temporary, and they should scale up very shortly. If you haven’t refinanced last quarter there are likely still excellent rates for you and possibly more to come.<o:p></o:p></div>
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<b>Exhibit 2 – 30- Year Fixed Rate Mortgage Average<o:p></o:p></b></div>
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<a href="https://1.bp.blogspot.com/-m88aQ6KERKY/XZtponjxGSI/AAAAAAAACFo/u7TBcvugdzAloCX4-bX256utYiGdbBgqACLcBGAsYHQ/s1600/Exhibit%2B2%2B%25E2%2580%2593%2B30-%2BYear%2BFixed%2BRate%2BMortgage%2BAverage.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="252" data-original-width="468" src="https://1.bp.blogspot.com/-m88aQ6KERKY/XZtponjxGSI/AAAAAAAACFo/u7TBcvugdzAloCX4-bX256utYiGdbBgqACLcBGAsYHQ/s1600/Exhibit%2B2%2B%25E2%2580%2593%2B30-%2BYear%2BFixed%2BRate%2BMortgage%2BAverage.jpg" /></a></div>
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<i>Source - <a href="https://fred.stlouisfed.org/series/MORTGAGE30US" style="color: #954f72;">https://fred.stlouisfed.org/series/MORTGAGE30US</a></i></div>
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<b>Santa Clara County Snapshot<o:p></o:p></b></div>
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As predicted, the number of Active homes dropped as we exited the summer peak months of inventory. With the drop in inventory, the market showed some relief for Sellers as the days on market for sold homes dropped 36% for Single Family Homes and 19% for Condominiums/Townhomes respectively. The homes that are on the market continue to sit for 38 days and counting, but still 30% and 21% respectively lower than last quarter.<o:p></o:p></div>
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For Single Family Homes we cleared out more inventory in this sector as homes that sold were sold quickly within 2 weeks. The Condominium/Townhome sector took exactly a week longer at 3 weeks on the market to sell but didn’t clear as much inventory with some residual inventory in the quarter. The number of listings taken off the market dropped as well.<o:p></o:p></div>
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In summary, the market has recovered slightly better in the third quarter as compared the second quarter. More homes are selling than last quarter, and they are selling at a faster pace.<o:p></o:p></div>
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<b>Exhibit 3 – Q3 2019 Santa Clara County Real Estate Snapshot <o:p></o:p></b><br />
<a href="https://1.bp.blogspot.com/-UcBxgY_3w24/XZtpy0mtMjI/AAAAAAAACFw/mAQdCQGbazkoN7erd1a5kk18Vt7JMaXCwCLcBGAsYHQ/s1600/Exhibit%2B3%2B%25E2%2580%2593%2BQ3%2B2019%2BSanta%2BClara%2BCounty%2BReal%2BEstate%2BSnapshot%2B.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="261" data-original-width="468" src="https://1.bp.blogspot.com/-UcBxgY_3w24/XZtpy0mtMjI/AAAAAAAACFw/mAQdCQGbazkoN7erd1a5kk18Vt7JMaXCwCLcBGAsYHQ/s1600/Exhibit%2B3%2B%25E2%2580%2593%2BQ3%2B2019%2BSanta%2BClara%2BCounty%2BReal%2BEstate%2BSnapshot%2B.jpg" /></a><br />
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<i>Source – MLS Listings Database</i></div>
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<b>Seller Advice<o:p></o:p></b></div>
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Firstly, in many areas, home prices are down anywhere from 10% to 20% from 2018. This is a reality that you will have to accept before being able to successfully sell your home.<o:p></o:p></div>
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As a Seller, you want to be priced at market and have a move-in ready home so that you are one of the sold homes - not the one that is sitting on the market. Buyers have many choices and your home has to stand out among the pack. At times it may not be possible to re-model; in that case, we will do our best to address “low hanging fruit” and be sure to stage your home to compensate. The Condominium and Townhome sectors have improved but continue to struggle, especially if they are not in a prime school district. There are many new home construction builders cutting deals and providing enormous incentives that are hard to match. Creativity will be required.<o:p></o:p></div>
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<b>Buyer Advice<o:p></o:p></b></div>
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As a Buyer, this is your market! With the price drops and lower mortgage rates, homes have gotten more affordable than in years past. Bear in mind that not all homes are created equal. A home located in a prime location, with good schools, re-modeled and priced right will sell with a few offers, typically though not as aggressive as in prior years. Homes that are on the market for a longer period of time are the ones where you will have more leverage. Be sure you evaluate all options, old and new, and that you have the right team that knows how to operate in both realms. If at all possible, take advantage of this upcoming season as the market tends to slow down. Though you don’t have as many choices, if a Seller needs to sell they likely really “need” to sell and deals can be had.<o:p></o:p></div>
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<b>2020 Outlook<o:p></o:p></b></div>
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2020 is an election year and it is very likely going to be another fluctuating year for real estate. There will be a lot hinging on the trade war, impeachment situation and the ultimate selection of the president. Most interesting will be the down payments coming from the IPO’s that have occurred earlier this year; will those folks now be out and about to purchase real estate?<o:p></o:p></div>
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<b>Contact Us<o:p></o:p></b></div>
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For a customized real estate consultation or mortgage evaluation, <span style="color: #353535;">re</span>ach out to us at <span style="border: 1pt none; color: #665ed0; padding: 0in;"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;" target="_blank">alan@alanwangrealty.com</a> </span><span style="border: 1pt none; color: #665ed0; padding: 0in;"></span>(408)313-4352 so that we can analyze your specific real estate situations!<o:p></o:p></div>
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<b>Feeling Social?<o:p></o:p></b></div>
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Join the conversation on Linkedin! - <a href="https://www.linkedin.com/pulse/q3-2019-silicon-valley-real-estate-market-update-fluctuating-wang">https://www.linkedin.com/pulse/q3-2019-silicon-valley-real-estate-market-update-fluctuating-wang</a><o:p></o:p></div>
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Unknownnoreply@blogger.com8tag:blogger.com,1999:blog-6677356073587079062.post-65867330099202827692019-07-08T11:07:00.005-07:002019-07-08T14:41:02.777-07:00Q2 2019 Silicon Valley Real Estate Market Update - The Tale of Four Markets<div dir="ltr" style="text-align: left;" trbidi="on">
In the first quarter of this year, the real estate market had a slow start, both here in the Silicon Valley and nationwide. Buyers remained hesitant from the slow bear market that took place in the latter half of 2018. Many thought that this was the end of the real estate market and that we were in a full recession. However, in the second quarter, the market picked up variably and manifested itself into 4 market segments: Luxury, Prime Locations, Single Family Homes and the Condominium/Townhomes.<br />
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<b>The Tale of 4 Markets</b><br />
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Overall the market is more balanced with the advantage skewing in favor of Buyers. Actual performance depends on the specific market segment. Homes in fully renovated condition and/or in prime locations continue to sell at a premium, quickly and with multiple offers. Sellers continue to struggle with the reality of the market by holding onto prices from the peak market last year. Those that do, find their homes sitting longer on the market with very few visitors every week and lower prices to no offers. Buyers that do offer are not willing to pay last year’s prices and often have other homes on the market to pursue. We have seen anywhere from a 10% to 20% drop in prices since last year in varying neighborhoods.<br />
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<b>Luxury</b><br />
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The Luxury market will continue to be its own market segment. These Buyers are looking for “the” home that matches “their” requirements. They have the means regardless of the state of the real estate market, though the number of available competitors reduces in a down market which is to their advantage.<br />
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<b>Prime Locations</b><br />
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The age-old adage “Location, Location, Location” really shows itself in a declining market. In the Silicon Valley, a Prime location is defined as a pairing of an excellent school district with the closest distance to work. This segment has made a comeback in the second quarter with the return of multiple offers and competitive bids, albeit not as aggressive as the price overbids in the last decade.<br />
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<b>Single Family Homes</b><br />
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Single Family Homes have always been the preferred home class for Buyers. It is preferable to own the lot with space for the family, with no Homeowners Association (HOA) rules and possible increases in the monthly fee or special assessments. Single Family homes around the million dollar price range continue to sell due to affordability. Single Family homes greater than a million dollars will vary depending on the neighborhood but will generally struggle without a strong school district and location.<br />
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<b>Condominiums and Townhomes</b><br />
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This market segment has been decimated and extremely slow. One of the key reasons is that there is quite a bit of brand new home construction coming online. When the market shifted, new home builders scrambled to acquire land that they had stopped purchasing during the downturn. Once acquired they have a long and arduous process of design, city and county approval for their plans, and the leg work in order to get their developments online, which all take time. As these finally start coming to fruition the market turns, and this product group floods the market with more inventory in addition to what is on the market. The second reason is that prices have risen so high and with a market correction, Single Family homes are more within reach. Homes with excellent schools paired with locations have not seen an impact.<br />
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<b>Santa Clara County Real Estate Snapshot</b><br />
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<a href="https://1.bp.blogspot.com/-VR2_aaJkcdw/XSOGMPcc1_I/AAAAAAAACE8/kWBW-qeDurgEtrjqweUYa3wVag_SReYJQCLcBGAs/s1600/Slide1.jpeg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="405" data-original-width="720" src="https://1.bp.blogspot.com/-VR2_aaJkcdw/XSOGMPcc1_I/AAAAAAAACE8/kWBW-qeDurgEtrjqweUYa3wVag_SReYJQCLcBGAs/s1600/Slide1.jpeg" /></a></div>
<b>Macroeconomics</b><br />
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As we head into election year, most presidents have kept the economy stable in order to support their re-election. The key wildcard is the China trade war which continues to weigh on the markets. However, the NASDAQ hit yet another record this week and despite the volatility, Silicon Valley workers do have equity to tap into if they choose to. The Federal Reserves has signaled that they may drop interest rates sometime this year which will help the real estate market by lowering interest rates further. These are all important foundations for the real estate market.<br />
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<b>Microeconomics</b><br />
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The Silicon Valley continues to hum along with low unemployment rates and multiple initial public offerings (IPO’s). The blackout periods have yet to free up capital that will surely be poured into real estate. We are expecting Q4 2019 and much of 2020 to have an influx of homebuyers centralized in San Francisco, the Peninsula, the South Bay and parts of the East Bay as well.<br />
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<b>Interest Rates Have Dropped; Time to Refinance or Purchase</b><br />
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It is time to refinance your mortgage - especially the 30-year fixed mortgage. Rates have trended downward and have hit and surpassed the lowest point in the last decade allowing you to reduce hundreds of dollars off of your mortgage. The 30-year, 10-year and 7-year fixed products all have excellent purchase rates. Needless to say, you can buy more house with these lower rates. For those of you that are cash heavy, our lender can also drop your rate by approximately 0.125% for every $250,000 of assets under management. Re-casting is also a feature that our lender provides. Re-casting is when you pay down your mortgage by $20,000 or more and your monthly payments are re-calculated and brought down if you so choose to do so.<br />
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<b>Looking Forward to Q3 2019</b><br />
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As we wrap up the summer months, inventory levels tend to peak in July and homes that don’t sell linger into the fall season. This year the Days On Market have been longer and we will likely continue clearing out inventory for months to come with fewer homes coming online as the year progresses. Not all homes will sell, hence we will likely see more canceled, expired or withdrawn listings. With interest rates dropping to again historical rates with another looming federal reserve rate drop, mortgages won’t stop Buyers from purchasing. The question is, do Buyers feel confident enough in the economy and market to make home purchases? More importantly, have Sellers come to terms with home prices dropping anywhere from 10% to over 20% in the last year? If you are a Seller being patient, making the necessary updates to stand out from the competition and adjusting your price expectations will be the key to selling your home. If you are a Buyer, unless you are going for a home in the prime locations, the advantage is on your side in every way.<br />
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<b>Contact Us</b><br />
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For a customized real estate consultation or more details on these loan programs, reach out to us at <a href="mailto:alan@alanwangrealty.com">alan@alanwangrealty.com</a> (408)313-4352 so that we can analyze your specific real estate situations!<br />
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<b>Feeling Social?</b><br />
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Join the conversation on Linkedin -<a href="https://www.linkedin.com/pulse/q2-2019-silicon-valley-real-estate-market-update-tale-alan-wang" target="_blank"> https://www.linkedin.com/pulse/q2-2019-silicon-valley-real-estate-market-update-tale-alan-wang</a></div>
Unknownnoreply@blogger.com5tag:blogger.com,1999:blog-6677356073587079062.post-48536445703740067932019-04-01T16:58:00.000-07:002019-04-02T07:14:23.864-07:00Q1 2019 Silicon Valley Real Estate Market in Equilibrium<div dir="ltr" style="text-align: left;" trbidi="on">
2019 has started off with the market attempting a recovery from a cruel summer and winter real estate market for especially for Sellers last year. Buyers are generally out and about, although they seem concerned and wondering if the market will drop further. However, in the past few weeks we have seen an uptick in Buyers actually making offers and getting into contract. Let us dive deeper in the various dimensions of this new market in equilibrium.<br />
<br />
<b>Silicon Valley Real Estate Snapshot – Santa Clara County</b><br />
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<b><i>Exhibit 1 – Santa Clara County Real Estate Snapshot January 2019 to March 2019</i></b><br />
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<a href="https://2.bp.blogspot.com/-Ly3pM5Hr7Qc/XKKibVWawVI/AAAAAAAACEI/lohcsIzp3uATnjBD1b3iY-EPNTdHHfgKgCLcBGAs/s1600/Exhibit%2B1.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="255" data-original-width="468" height="216" src="https://2.bp.blogspot.com/-Ly3pM5Hr7Qc/XKKibVWawVI/AAAAAAAACEI/lohcsIzp3uATnjBD1b3iY-EPNTdHHfgKgCLcBGAs/s400/Exhibit%2B1.jpg" width="400" /></a></div>
<br />
More homes came on the market in the Q1 than in Q4 2018. This is not surprising given the holidays months Sellers are less willing to go on market during this time. Interesting statistics are the amount of homes taken off the market in Q4 2018 which has added to the inventory levels as they were re-listed this year, further increasing the available inventory on the market. The good news is that Buyers are purchasing and working on clearing out the existing inventory of homes. Sold units have increased since last quarter but the days on market have increased by over double, in short homes are taking longer to sell. We anticipate inventory levels to continue to rise as we approach the summer months.<br />
<br />
<b>Macroeconomics</b><br />
<br />
On a Macro level there are many factors that continue to contribute to the fluctuation of Real Estate; such as Interest Rates, the NASDAQ index and the Trade War with China.<br />
<br />
<b>Mortgage Rates</b><br />
<br />
The Federal Reserve has officially announced that they do not plan to raise interest this year. In fact mortgage rates have seen a decline since. Many of our clients have refinanced their loans and those with liquid cash or investments in major banks can take advantage of further mortgage rate reductions as well.<br />
<br />
<b><i>Exhibit 2 – 30 Year Fixed Mortgage Average in the United States</i></b><br />
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<a href="https://2.bp.blogspot.com/-I0-EgEDvRgQ/XKKiWVLFfPI/AAAAAAAACEA/QyDjyR_2Fdkost4Y99a3bm1T4-u9t_scQCLcBGAs/s1600/Exhibit%2B2.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="224" data-original-width="468" height="190" src="https://2.bp.blogspot.com/-I0-EgEDvRgQ/XKKiWVLFfPI/AAAAAAAACEA/QyDjyR_2Fdkost4Y99a3bm1T4-u9t_scQCLcBGAs/s400/Exhibit%2B2.jpg" width="400" /></a></div>
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Source – St Louis Federal Reserve - <a href="https://fred.stlouisfed.org/series/MORTGAGE30US">https://fred.stlouisfed.org/series/MORTGAGE30US</a><br />
<br />
<b>Trade Wars and the NASDAQ</b><br />
<br />
There has not been substantial movement on the Trade War with China. The key movement has been the recovery in the stock market, specifically the Technology rich NASDAQ, which has recovered nicely from the low point in December.<br />
<br />
<b>Exhibit 3 – NASDAQ Snapshot April 1, 2019</b><br />
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<a href="https://4.bp.blogspot.com/-k04RA_fyEa4/XKKi9g00VNI/AAAAAAAACEQ/u4dg_0H1SFYrC0XCD7MFTe9DF5QG_MiiQCLcBGAs/s1600/Exhibit%2B3.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="249" data-original-width="468" height="211" src="https://4.bp.blogspot.com/-k04RA_fyEa4/XKKi9g00VNI/AAAAAAAACEQ/u4dg_0H1SFYrC0XCD7MFTe9DF5QG_MiiQCLcBGAs/s400/Exhibit%2B3.jpg" width="400" /></a></div>
<br />
<i>Source – Yahoo! Finance</i><br />
<br />
<b>Tech Initial Public Offerings (IPO’s)</b><br />
<br />
Lfyt went IPO on Friday and projections are that Uber (filed in December), Slack (filed in February), Pinterest (filed in March), Postmates (filed in February) and Zoom (filed in March) are the next on deck. With the exception of Zoom (based out of San Jose), all of these companies are based in San Francisco. What this means is that the wealth will be centered in San Francisco, the second tier will likely be homes on the Peninsula for families looking for better school districts and lastly the third tier will be the Southbay for those that commute to the city or those with a spouse that is based out of the Southbay. Remember, when a company IPO’s there is typically a 6-month lockout period before employees are allowed to sell their shares. It likely won’t be until late this year to early next year before the liquidity will actually be realized in our real estate markets. 2020 will shape up to be an interesting year where likely all of this liquidity may actually be invested into the Real Estate market.<br />
<br />
<b>Bay Area Sentiments</b><br />
<br />
As we are coming off peak of the last gold rush both in housing and in stocks, many are taking a step back and re-evaluating the Silicon Valley financial and physical impact on their lives. What many outsiders fail to understand, is that the Silicon Valley is a constant grind, pure hard work and full of stress to make ends meet. There are frequent choices between working on the next innovation and trading off ones’ health and time to work verses time with their families. The sheer number of people in the Bay Area has taxed the infrastructure causing horrid traffic issues. Due to the high cost of housing, many are pushing 3 or more hours just on the commute to get to the office. Due to these factors some have chosen to leave the Bay Area in search of better work life balance and more affordable housing.<br />
<br />
<b>Looking Forward to Q2 2019</b><br />
<br />
With lower interest rates, a rebound in the stock market and more inventory, the market is trying to jumpstart itself from a brutal latter half of 2018. Though the market is more balanced Buyers are still in the driver’s seat. Buyers are looking for move-in ready homes that require little to no work, are generally not interested in aggressive overbidding (except exceptional homes) and are not in a hurry and taking their time. On the Selling side, Seller must let go of Q2 2018 prices which was the peak of the market and be ready for longer days on the market and be ready to negotiate in order to get the home sold. We do anticipate more and more inventory to come on line as is typical in the summer months which means more competition for Sellers and more choices for Buyers.<br />
<br />
We are hoping you are enjoying the upcoming months of sunshine!<br />
<br />
Reach out to us at <a href="mailto:alan@alanwangrealty.com" target="_blank">alan@alanwangrealty.com</a> (408)313-4352 so that we can analyze your specific real estate situations!<br />
<br />
Feeling Social? Join the conversation on Linkedin! - <a href="https://www.linkedin.com/pulse/q1-2019-silicon-valley-real-estate-market-equilibrium-alan-wang">https://www.linkedin.com/pulse/q1-2019-silicon-valley-real-estate-market-equilibrium-alan-wang</a></div>
Unknownnoreply@blogger.com4tag:blogger.com,1999:blog-6677356073587079062.post-463721114897268202019-01-10T20:53:00.001-08:002019-01-11T08:06:25.549-08:002018 Silicon Valley Real Estate Year in Review and 2019 Outlook<div dir="ltr" style="text-align: left;" trbidi="on">
<div dir="ltr" style="text-align: left;" trbidi="on">
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<b style="color: #202020;"><span style="background: white;">2018 Year in Review</span></b></div>
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<span style="background-color: white; color: #202020;"><br /></span>
<span style="background-color: white; color: #202020;">2018 has been a roller coaster ride for the Real
Estate market. We kicked off 2018 the same way 2017 went all year in an extreme
Sellers’ market, with multiple Buyers fighting tooth and nail to win a small
amount of homes. Around April of 2018, the market screeched to a halt; homes
sat for a month to 2 months or more and it shifted to a more balanced market.
Buyers were in a "wait and see" mode, and the Buyers that were ready
to buy held strong to their positions looking for a deal. Sellers willing to come
down on pricing and were patient sold their homes, but the ones that were
holding onto peak pricing did not sell, sat on the market, cancelled their
listed or rented out their homes. Buyers got more particular so homes that were
re-modeled were highly coveted, as opposed to homes that were not. We saw an
average price drop of anywhere from 10% to even 20% in some areas.</span></div>
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<span style="background: white; color: #202020;"><br />
<b style="mso-bidi-font-weight: normal;">Silicon Valley Real Estate Snapshot –
Santa Clara County</b></span><span style="color: #202020; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;"><br />
<span style="background: white;"> </span></span></div>
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<span style="color: #353535;">Looking at the data since Q4 of 2018 there is some good and bad news. For Sellers it is refreshing to see inventory levels (your competition) drop by 49%/39%. For Buyers this means that there are less homes to buy for now. We are expecting inventory to ramp up week by week and peak in the summer season, expect competitors will increase and Buyers will have more home choices. For Sellers the other key metrics are not in your favor. The average time homes have been sitting on the market are going for 72/57 days, meaning homes were sitting on the market twice as long than in Q3 2018. The number of days for Sold homes have increased slightly, but the number of actually sold units half dropped by about half. This means about half of the inventory in Q4 did not sell and many may come back on the market this year. Overall none of these are great trends for Sellers, better news for Buyers, overall a more balanced market nonetheless.</span></div>
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<span style="color: #202020; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;"><br />
</span><b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Exhibit 1 – Santa Clara
County Real Estate Snapshot October to January 2019<o:p></o:p></span></b></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Macroeconomics<o:p></o:p></span></b></div>
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<span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">On
a Macro level there are many factors currently in-flux which are contributing
to the de-stabilization of Real Estate; such as Interest Rates, the NASDAQ
index, Trade Wars and Protectionism.<o:p></o:p></span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Mortgage Rates<o:p></o:p></span></b></div>
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<span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">First
off interest rates have leveled off and moved downward slightly. The Federal
Reserve has indicated that it would throttle off a bit from the interest rate
hikes in the interim, likely due to the volatility in the economy. This may get
more buying activity from the Buyer pool.<o:p></o:p></span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Exhibit 2 – 30 Year Fixed
Mortgage Average in the United States<o:p></o:p></span></b></div>
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<a href="https://2.bp.blogspot.com/-cYiIpPKCKVo/XDggkUL26KI/AAAAAAAACDU/_hVJccLynDUjnfZEzMJe53wtt0EYdirxgCLcBGAs/s1600/Exhibit%2B2%2B%25E2%2580%2593%2B30%2BYear%2BFixed%2BMortgage%2BAverage%2Bin%2Bthe%2BUnited%2BStates.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="292" data-original-width="468" src="https://2.bp.blogspot.com/-cYiIpPKCKVo/XDggkUL26KI/AAAAAAAACDU/_hVJccLynDUjnfZEzMJe53wtt0EYdirxgCLcBGAs/s1600/Exhibit%2B2%2B%25E2%2580%2593%2B30%2BYear%2BFixed%2BMortgage%2BAverage%2Bin%2Bthe%2BUnited%2BStates.jpg" /></a></div>
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<i style="mso-bidi-font-style: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Source – St Louis Federal
Reserve - </span></i><span class="MsoHyperlink"><i style="mso-bidi-font-style: normal;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><a href="https://fred.stlouisfed.org/series/MORTGAGE30US">https://fred.stlouisfed.org/series/MORTGAGE30US</a></span></i></span><i style="mso-bidi-font-style: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><o:p></o:p></span></i></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Trade Wars and Protectionism<o:p></o:p></span></b></div>
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<span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">The
NASDAQ Index was hammered most of December but has rebounded 8% from the lowest
point last year since Christmas Eve. They new hope is that the US and China
trade wars can come to a settlement soon. Remember the health of Technology
stocks on the NASDAQ are directly correlated to Silicon Valley housing
downpayments that power the real estate market. The Government deadlock and
shutdown is unprecedented and is also weighing on the minds of the public.<o:p></o:p></span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Exhibit 3 – NASDAQ Snapshot January
11, 2019 <o:p></o:p></span></b></div>
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<a href="https://1.bp.blogspot.com/-eS7DPpuSakg/XDggtf9etNI/AAAAAAAACDY/00wirgmQX-c4CkEjDV-gNoBGQLCarnihgCLcBGAs/s1600/Exhibit%2B3%2B%25E2%2580%2593%2BNASDAQ%2BSnapshot%2BJanuary%2B11%252C%2B2019.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="298" data-original-width="468" src="https://1.bp.blogspot.com/-eS7DPpuSakg/XDggtf9etNI/AAAAAAAACDY/00wirgmQX-c4CkEjDV-gNoBGQLCarnihgCLcBGAs/s1600/Exhibit%2B3%2B%25E2%2580%2593%2BNASDAQ%2BSnapshot%2BJanuary%2B11%252C%2B2019.jpg" /></a></div>
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<i style="mso-bidi-font-style: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Source – Yahoo! Finance<o:p></o:p></span></i></div>
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<b><span style="color: #202020; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;">Looking
Forward to 2019 </span></b><span style="color: #202020; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;"><br />
<span style="background: white;"> </span><br />
<span style="background: white;">Just 2 weeks into 2019, inventory levels are low
due to the holiday season. At the moment, the homes that are out on the market
are selling quickly - some with multiple offers. The trends of homes in good/move-in
condition are selling better than homes in original condition, and some homes are
receiving multiple offers, are back for now. If you are a Seller, you may want
to strike while the iron is warm. As a Buyer, you will need to adjust from last
year's slower market until inventory levels catch up to demand, and possibly get
slightly more aggressive in the short run if needed. There is still residual
inventory from the winter months and you maybe able to get a deal on those
properties. Continued instability in our government, international trade war
talks and a continually volatile stock market have brought uncertainty to our
Real Estate Market in 2019. All of these will be factors to monitor in the
coming year and will directly have an impact on Silicon Valley Real Estate.</span></span><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><o:p></o:p></span></div>
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<span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">We
hope you had an amazing winter break. Reach out to us at </span><span class="MsoHyperlink"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><a href="mailto:alan@alanwangrealty.com">alan@alanwangrealty.com</a></span></span><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">
(408)313-4352 so that we can analyze your specific real estate situations!<o:p></o:p></span></div>
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<b><span style="border: none windowtext 1.0pt; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-border-alt: none windowtext 0in; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US; padding: 0in;">Happy
New Year!</span></b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;"><o:p></o:p></span></div>
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<b><span style="border: none windowtext 1.0pt; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-border-alt: none windowtext 0in; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US; padding: 0in;"><br /></span></b></div>
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<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;">We hope that you and your families had a restful holiday break! A big
thank you for being amazing advocates of our real estate business! It is
because of your never ending referrals, loyalty and support as our customers
that we were able to help over 105 families in 2018. It was you that helped
propel us to be the 64th team in the world out of over 195,000 Agents at
Keller Williams. We cannot thank you all enough for all of your support!<o:p></o:p></span></div>
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<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman"; mso-fareast-language: EN-US;">Reach out to us at <span style="border: none 1.0pt; color: #665ed0; padding: 0in;"><a href="http://mailto:alan@alanwangrealty.com/" target="_blank">alan@alanwangrealty.com</a> </span>(408)313-4352
so that we can analyze your specific real estate situations!<o:p></o:p></span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Feeling Social?<o:p></o:p></span></b></div>
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<span style="color: #353535; mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;">Join
the conversation on Linkedin! <a href="https://www.linkedin.com/pulse/2018-silicon-valley-real-estate-year-review-2019-outlook-alan-wang/">https://www.linkedin.com/pulse/2018-silicon-valley-real-estate-year-review-2019-outlook-alan-wang</a><o:p></o:p></span></div>
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Unknownnoreply@blogger.com14tag:blogger.com,1999:blog-6677356073587079062.post-8614632348532042462018-10-25T14:10:00.005-07:002018-10-25T14:26:17.749-07:00Q3 2018 Silicon Valley Real Estate Update - Stabilization in Effect as Home Prices Continue Decline<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="color: #353535; font-family: "applesystemuifont"; font-size: 12pt;">Q3 2018 has been yet another eventful quarter in our continuing shifting stabilizing Silicon Valley Real Estate Market. Please find our update to help guide your real estate decisions!</span><span style="font-family: -webkit-standard;"></span><br />
<span style="color: #353535; font-family: "applesystemuifont"; font-size: 12pt;"><br /></span>
<b><span style="color: #353535; font-family: "applesystemuifont";">Home Prices Peaked<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Home prices peaked in the month of May and this market shift came very quickly. As mentioned in our Q2 update, the reasons were exhausted home bidders, unaffordability of prices, the drop in the NASDAQ Index in April, tax filing deadlines, coupled with a rise in inventory for the summer months. Homes started to sit on the market and Buyers took a wait and see approach which has continued until now and likely the rest of the year. The conundrum is that there are still Buyers out there, however affordability continue to be a concerning factor.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 1 – Santa Clara County Real Estate Snapshot July to September 2018<o:p></o:p></span></b></div>
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<a href="https://2.bp.blogspot.com/-4O73Sj3HA-Y/W9Iw0I0G0FI/AAAAAAAACCo/7MGMHBAOa5ERwAnqUQEzPMEg9CAO5qPjwCLcBGAs/s1600/Exhibit%2B1.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="259" data-original-width="468" height="221" src="https://2.bp.blogspot.com/-4O73Sj3HA-Y/W9Iw0I0G0FI/AAAAAAAACCo/7MGMHBAOa5ERwAnqUQEzPMEg9CAO5qPjwCLcBGAs/s400/Exhibit%2B1.jpg" width="400" /></a></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Taking Santa Clara County as a sample comparing to data from Q2 2018, the amount of Active homes increased in the Single Family Home category by 31% while Condominium/Townhomes increased by 93%. Subsequently the days on market also increased dramatically for Sold and Active homes in both categories. What is interesting is that Sold Units more than doubled the amount of units in Q2. This shows that Buyers demand is still there paired with more quantity of homes on the market during the summer months to purchase. In short, inventory and days on market are up, but Buyers are still purchasing homes but they are taking their time and looking for better pricing and more favorable terms. The crazy bidding market is gone and the Buyers in the market are at an advantage.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 1a – Santa Clara County Real Estate Snapshot June 2018<o:p></o:p></span></b></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source - MLS Listings Database REIL June 2018<o:p></o:p></span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Macroeconomics<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">On a Macro level there are many factors currently in-flux which are contributing to the stabilization of Real Estate such as the NASDAQ index, Trade Wars, Protectionism and Rising Interest Rates.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Health of Equity Markets<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The key concern is the health of the Stock </span><span style="font-family: "applesystemuifont";">Markets, especially the Technology-<span style="color: #353535;">heavy NASDAQ index, which is the source of the majority of the down payments in the Silicon Valley. Notice the drop back in April and now another two recent drops in October. Oddly the economy and companies have generally been showing good overall health. There have been some companies that have revised lower guidance on earnings but most have shown decent earnings. Investor sentiment seem to be expressing concern across the board especially of a possibly overheated Technology sector and therefore companies being overvalued. We have just experienced the largest sell off in the second and third weeks of October and the markets have continued to show volatility since.<br /><br /><o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 2 – NASDAQ Snapshot October 25, 2018 <o:p></o:p></span></b></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – Yahoo! Finance<o:p></o:p></span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Trade Wars<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The trade war with China is causing concerns about the impact to both economies. Companies who export from China are seeing their margins wiped out and goods from China could get more expensive here in the States. Companies that export to China will see a hit in revenue due to the counter tariffs from China. There is much concern from investors on the ultimate impact to profitability and this subsequently will affect equity values and our economy.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Protectionism<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The current protectionist policies are making the visa and residency process even more difficult than they have previously been. Many key believers in purchasing real estate in the Silicon Valley are typically from abroad. With this uncertainty, Buyers are holding off on their home purchases, heading home or heading to countries with simpler more transparent visa processes.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Interest Rates<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Federal Reserve interest </span><span style="font-family: "applesystemuifont";">rates have been increased 3 times this year. This will ultimately impact affordability. Some Lenders have been able to keep interest rates around the 4.5% to 4.75% range. Some other lenders have touched the 5% mark.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 3 – Federal Reserve Interest Rate<o:p></o:p></span></b></div>
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<a href="https://3.bp.blogspot.com/-yf4Z8I-2k6I/W9IxGcZ_JBI/AAAAAAAACC0/aloavsVnNmgeEBOaf7vYFzixGN6mcD81QCLcBGAs/s1600/Exhibit%2B3.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="224" data-original-width="468" height="190" src="https://3.bp.blogspot.com/-yf4Z8I-2k6I/W9IxGcZ_JBI/AAAAAAAACC0/aloavsVnNmgeEBOaf7vYFzixGN6mcD81QCLcBGAs/s400/Exhibit%2B3.jpg" width="400" /></a></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – St. Louis Federal Reserve</span></i></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Despite concerns about affordability and rising rates, interest rates are still at historical lows.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 4 – 48-Year History of the 30-Year Fixed Mortgage Rate<o:p></o:p></span></b></div>
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<a href="https://3.bp.blogspot.com/-mjT63WMfX4E/W9IxL1c-GaI/AAAAAAAACC8/AY2Xh9Uc64Ubc4yG-tRCWh8vXAF74CzmwCLcBGAs/s1600/Exhibit%2B4.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="226" data-original-width="468" height="192" src="https://3.bp.blogspot.com/-mjT63WMfX4E/W9IxL1c-GaI/AAAAAAAACC8/AY2Xh9Uc64Ubc4yG-tRCWh8vXAF74CzmwCLcBGAs/s400/Exhibit%2B4.jpg" width="400" /></a></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – St Louis Federal Reserve</span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Seasonality, Buyer and Seller Advice<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">As we approach the holiday season, regardless of the overall market conditions, this tends to be the slower season for Real Estate overall. If you are a Buyer, this is your market to obtain deals due to the season and current market conditions. Lower down payments, under list price offers, contingencies and long closes are all possibilities. If you are a Seller, homes are still moving if we price them properly it should move in 17 to 30 days. The hardest part is to understand the market and not going after peak pricing that passed us in April. That market has passed us at this point.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">In Conclusion<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">To be clear the market is still a healthy and more balanced. Silicon Valley Homeowners have been spoiled by homes selling in a week with multiple offers which was never scalable. With the latest concerns especially around the equity markets and rising interest rates coupled with the slower typical seasons, Real Estate in 2019 should continue to stabilize and could possibly also mirror the volatility of the equity markets. Though we cannot predict the future, it is likely that 2019 will be another more stable and balanced market for real estate.<o:p></o:p></span></div>
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<span style="color: #353535; font-family: "applesystemuifont";">We wish you the best as you close out 2018! Reach out to us at </span><span class="MsoHyperlink" style="color: #0563c1; text-decoration: underline;"><span style="font-family: "applesystemuifont";"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;">alan@alanwangrealty.com</a> </span></span><span style="color: #353535; font-family: "applesystemuifont";">so that we can analyze your specific real estate situations!<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Feeling Social?<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Join the conversation on Linkedin - <a href="https://www.linkedin.com/pulse/q3-2018-silicon-valley-real-estate-update-effect-home-alan-wang">https://www.linkedin.com/pulse/q3-2018-silicon-valley-real-estate-update-effect-home-alan-wang</a><o:p></o:p></span></div>
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Unknownnoreply@blogger.com9tag:blogger.com,1999:blog-6677356073587079062.post-68651152085584978782018-07-02T15:48:00.004-07:002018-07-03T07:39:10.701-07:00Q2 2018 Real Estate Update - At Long Last the Market Shifts to the Buyers’ Favor<div dir="ltr" style="text-align: left;" trbidi="on">
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<span style="color: #353535; font-family: "applesystemuifont";">We are excited to share our Q2 2018 Silicon Valley Real Estate update. We will start off by saying that the market has at long last <b>SHIFTED </b>to the Buyer</span><span style="font-family: "applesystemuifont";">s’ <span style="color: #353535;">favor! It has been a roller coaster this year and we have many areas to update you on!<o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">January to April – Red Hot Sellers’ Market<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The beginning of the year continued the previously hot Sellers’ market of 2017. The same story continued this year; low inventory levels, large quantity of Buyers, intense bidding wars, prices rising on a weekly basis and each home selling aggressively more than the previous week’s sale price. If a Buyer had less than 30% percent downpayment and did not make it into the top 3 offers, they would have had little to no chance to win. Agents and Buyers had to be aggressive, constantly following up, overbid pricing by emotion, waive all conditions on their offers, close quickly and give in to the terms of the Sellers. The Sellers during this period truly maximized their gains both on pricing and terms.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">April and May – The Turning Point<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">In April we started to see some softening in the market as we started to notice fewer offers per listing. We monitored this trend to see if this was signaling a possible stabilization in prices. Literally the first week of May we saw Buyers stop in their tracks. The typical indicators remained strong; Open House traffic, Agent Showing traffic and Disclosure requests all showed normal activity. We were setting offer dates as we have for the last year and a half expecting the same multiple offers, and for the home to sell significantly over list price. That activity came to a screeching halt. Listings got one to two lower priced offers and many had none at all. 11 weeks in now we can confirm that the market has shifted to the Buyers advantage for the first time since 2017. Not all markets have been affected but slowly this is trickling into all price points.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">What is Causing this Market Stabilization?<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Understanding this market stabilization requires analyzing the historical and current trends both at a Macroeconomic and Microeconomic level.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Footnote on Sustainability and Seasonality<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">It is important to note that this type of aggressive Sellers’ market was never sustainable. Even as Realtors in the business, we would watch our listings blow through the last comparable home sales and we have always known that at some point there must be a stabilization. It is also important to note that it is abnormal </span><span style="font-family: "applesystemuifont";">for a market not to<span style="color: #353535;">have cycles for such a long period of time. We typically have seasonality in our local real estate market. The same stabilization happened in June of 2016 as well and in years past, so none of this is out of the ordinary whatsoever.<o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Macroeconomics<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The key question is what changed at the macroeconomic level that would cause a direct correlation to this market stabilization? The first key indicator for the Silicon Valley is the health of the Stock </span><span style="font-family: "applesystemuifont";">Market, especially the Technology-<span style="color: #353535;">heavy NASDAQ index. These stocks are the source of the down payments fueling real estate in the valley. International cash offers have been slowed down significantly and heavily scrutinized, hence recent real estate activity is directly correlated to local Technology stock funds. It is interesting to note that on April 2, 2018 there was a low point in the market after the peak set on March 5, 2018. This brief drop even though it lasted a few weeks could have been enough to pause multiple Buye</span>r’<span style="color: #353535;">s home searches. The second economic indicator is that April is tax month; with a </span>drop in stock <span style="color: #353535;">prices and likely capital gains to pay, it is possible that Buyers found themselves cash strapped with unexpected tax bills.<o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 1 – NASDAQ Snapshot April 2, 2018<o:p></o:p></span></b><br />
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<a href="https://www.blogger.com/u/1/blogger.g?blogID=6677356073587079062" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://3.bp.blogspot.com/-oG4JYNoGRok/Wzqs73V9KnI/AAAAAAAACBA/D-Vulz3_HgQjwnBaFLH9APWKhR3GiQD_wCLcBGAs/s1600/Exhibit%2B1%2B%25E2%2580%2593%2BNASDAQ%2BSnapshot%2BApril%2B2%252C%2B2018.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="263" data-original-width="468" height="222" src="https://3.bp.blogspot.com/-oG4JYNoGRok/Wzqs73V9KnI/AAAAAAAACBA/D-Vulz3_HgQjwnBaFLH9APWKhR3GiQD_wCLcBGAs/s400/Exhibit%2B1%2B%25E2%2580%2593%2BNASDAQ%2BSnapshot%2BApril%2B2%252C%2B2018.jpg" width="400" /></a></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – Yahoo! Finance</span></i></div>
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<span style="color: #353535; font-family: "applesystemuifont";">The third economic indicator would </span><span style="font-family: "applesystemuifont";">be that <span style="color: #353535;">the Federal Reserve interest </span>rate rose in April<span style="color: #353535;"> as well. In essence this was a third level of change for Buyers to adjust to, which was more psychological than material, as mortgage rates do not immediately adjust to the Federal Reserve rate changes. However, it is human nature to dislike change and it is likely that the combination of these factors caused the current market stabilization.<o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 2 – Federal Reserve Interest Rate</span></b></div>
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<a href="https://2.bp.blogspot.com/--7Jvwfhror0/WzqtOHXOcsI/AAAAAAAACBI/F7sNTCPwIwIbQ8jBidvsrO7LeLAUJe1pgCLcBGAs/s1600/Exhibit%2B2%2B%25E2%2580%2593%2BFederal%2BReserve%2BInterest%2BRate.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="227" data-original-width="468" height="193" src="https://2.bp.blogspot.com/--7Jvwfhror0/WzqtOHXOcsI/AAAAAAAACBI/F7sNTCPwIwIbQ8jBidvsrO7LeLAUJe1pgCLcBGAs/s400/Exhibit%2B2%2B%25E2%2580%2593%2BFederal%2BReserve%2BInterest%2BRate.jpg" width="400" /></a></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – St. Louis Federal Reserve - <a href="https://fred.stlouisfed.org/series/FEDFUNDS" style="color: #954f72;">https://fred.stlouisfed.org/series/FEDFUNDS</a><o:p></o:p></span></i></div>
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<span style="color: #353535; font-family: "applesystemuifont";">There are also grumblings of trade wars with other countries that weigh on the minds of many Americans and that impact is yet to be seen. If these changes affect stock values and our economy then that will be the direct impact yet to be seen.<o:p></o:p></span></div>
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<span style="color: #353535; font-family: "applesystemuifont";">It is our opinion that the combination of Macroeconomic factors such as a dip in stock prices, income tax season, </span><span style="font-family: "applesystemuifont";">and i<span style="color: #353535;">ncreasing interest rates all played a part in this halt in the real estate marketplace.<o:p></o:p></span></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Microeconomic Factors<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">There are other factors more local to our area specifically that we should bear in mind.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Buyer Fatigue, Rising Prices and Rising Inventory<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">It is likely that buyers have become tired of this bidding war environment for the last year and a half and are taking a break. It hasn’t been easy as a Buyer fighting with 10 to 20 Buyers per home, giving up your rights and moving at lightning speeds. Prices were also at all-time highs, and this coupled with rising interest rates may have given Buyers psychological pause. It is also important to note that in the Silicon Valley we have seasonality as well. The summer season is when most homes come on the market equating to more inventory, and Buyers have more choices. It is natural in those cases that homes will sit longer on the market.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 3 – Santa Clara County Real Estate Snapshot<o:p></o:p></span></b></div>
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<a href="https://2.bp.blogspot.com/-ysCFXavQSIE/WzqtYhbc_bI/AAAAAAAACBM/ab30EJO69Vc5d3_78HtJv6D7yEXzm4smQCLcBGAs/s1600/Exhibit%2B3%2B%25E2%2580%2593%2BSanta%2BClara%2BCounty%2BReal%2BEstate%2BSnapshot.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="257" data-original-width="468" height="218" src="https://2.bp.blogspot.com/-ysCFXavQSIE/WzqtYhbc_bI/AAAAAAAACBM/ab30EJO69Vc5d3_78HtJv6D7yEXzm4smQCLcBGAs/s400/Exhibit%2B3%2B%25E2%2580%2593%2BSanta%2BClara%2BCounty%2BReal%2BEstate%2BSnapshot.jpg" width="400" /></a></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source - MLS Listings Database REIL 2018<o:p></o:p></span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Silicon Valley Employment<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Employment rates in the Silicon Valley are at all-time highs and the health of the Silicon Valley employment market continues to be strong. From last year, employment has risen by 3.1% and the unemployment rate down to 2.3%. These are all healthy statistics for our local market.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 4 – Santa Clara and San Benito Counties Employment Data<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";"></span><span style="color: #353535; font-family: "applesystemuifont";"><o:p></o:p></span></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source - Employment Development Department - <a href="http://www.labormarketinfo.edd.ca.gov/file/lfmonth/sjos$pds.pdf" style="color: #954f72;">http://www.labormarketinfo.edd.ca.gov/file/lfmonth/sjos$pds.pdf</a><o:p></o:p></span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Silicon Valley Commercial Buildouts<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Local Technology Giants continue to expand all across the Bay Area. From Facebook picking up real estate in Sunnyvale and Fremont, to Google’s build out in Downtown San Jose, this supports the fact that hiring is strong as companies continue to fight for commercial real estate across the valley.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Mortgage Interest Rates<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">There is no need to panic because rates are slightly on the rise. Interest rates are still at historic lows! Ask Buyers who bought in the 80’s how high their rates were. Certain banks have been offering deposit incentives for a lower interest rate; these types of programs exist as well.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 5 – 47 Year History of the 30-Year Fixed Mortgage Rate</span></b></div>
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<i><span style="color: #353535; font-family: "applesystemuifont";">Source – St Louis Federal Reserve - <a href="https://fred.stlouisfed.org/series/MORTGAGE30US" style="color: #954f72;">https://fred.stlouisfed.org/series/MORTGAGE30US</a><o:p></o:p></span></i></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Buyer Advice<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">If you are a Buyer you can at last celebrate that the market has finally turned in your favor and it will likely continue to be the case for the rest of the year. The key question is will you follow the herd and wait, or will you take advantage and go for a home when less Buyers are doing so? It is very possible that the herd will be back once again in the spring. Do you want to follow the herd as they were bidding this year? Buyers tend to have the most choices in the summer, though they will find better deals in the fall, but not as much selection on houses during the latter seasons. If you have been thinking of buying, we highly recommend that you re-engage while the market is on your side.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Seller Advice<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">If you are a Seller this will be the toughest market for you, as likely you have been used to seeing homes selling in a week and over the last sold price consistently, and that activity has now halted and turned the other direction. Currently prices are going the opposite direction from the last peak prices 11 weeks ago. We are seeing 10% to 15% drops from last peak prices in some locations. This change is especially hard to accept. The first off market or first week offer could be your best offer. Waiting longer gives the Buyers even more advantage as the freshness of your listing goes stale and they begin to low ball you the longer your home sits on the market. Expect longer days on market, as much as 30 to 45 days. Houses are still selling just taking more time. Again, selling a home in a week was never sustainable. Buyers are taking their time, looking for deals and they have other options on the market. If you have owned your home for some time, celebrate your gains. You may have missed the peak of this year but coming off peak isn’t the worst scenario in the grand scheme of things. If you are looking to maximize, you may need to wait for a different season that is more to your advantage, assuming the market isn’t turning into a longer-term bear market. If you believe the market is turning for the long run, then it would make sense to take your games and exit the market.<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">In Conclusion<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">It is important to note that we do not have a crystal ball. Given the typical seasonality of our local market, it is likely that this market will remain slower now and for the rest of this year with an advantage to the Buyer. Looking forward, it is true that we are in year 10 of this bull market. There is always a possibility that a major shift is occurring and the market turns into a bear market now and for the foreseeable future. However, given the fact that the economic indicators appear to be more short-term blips than anything longer term, there is a big possibility that 2019 will be the return of the fierce Sellers’ market once again.<o:p></o:p></span></div>
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<span style="color: #353535; font-family: "applesystemuifont";">We wish you the best for the rest of 2018! Reach out to us at </span><span class="MsoHyperlink" style="color: #0563c1; text-decoration: underline;"><span style="font-family: "applesystemuifont";"><a href="mailto:alan@alanwangrealty.com" style="color: #954f72;">alan@alanwangrealty.com </a></span></span><span style="color: #353535; font-family: "applesystemuifont";">so that we can analyze your specific real estate situations!<o:p></o:p></span></div>
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<b><span style="color: #353535; font-family: "applesystemuifont";">Exhibit 6 – NASDAQ Snapshot July 2, 2018 – Market has already recovered from the last lull in April<o:p></o:p></span></b></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Source <a href="https://finance.yahoo.com/chart/%5EIXIC/?guccounter=1#eyJpbnRlcnZhbCI6IndlZWsiLCJwZXJpb2RpY2l0eSI6MSwidGltZVVuaXQiOm51bGwsImNhbmRsZVdpZHRoIjo1LjMyNTY3MDQ5ODA4NDI5MSwidm9sdW1lVW5kZXJsYXkiOnRydWUsImFkaiI6dHJ1ZSwiY3Jvc3NoYWlyIjp0cnVlLCJjaGFydFR5cGUiOiJsaW5lIiwiZXh0ZW5kZWQiOmZhbHNlLCJtYXJrZXRTZXNzaW9ucyI6e30sImFnZ3JlZ2F0aW9uVHlwZSI6Im9obGMiLCJjaGFydFNjYWxlIjoibGluZWFyIiwicGFuZWxzIjp7ImNoYXJ0Ijp7InBlcmNlbnQiOjEsImRpc3BsYXkiOiJeSVhJQyIsImNoYXJ0TmFtZSI6ImNoYXJ0IiwidG9wIjowfX0sInNldFNwYW4iOnsibXVsdGlwbGllciI6NSwiYmFzZSI6InllYXIiLCJwZXJpb2RpY2l0eSI6eyJwZXJpb2QiOjEsImludGVydmFsIjoid2VlayJ9fSwibGluZVdpZHRoIjoyLCJzdHJpcGVkQmFja2dyb3VkIjp0cnVlLCJldmVudHMiOnRydWUsImNvbG9yIjoiIzAwODFmMiIsInN5bWJvbHMiOlt7InN5bWJvbCI6Il5JWElDIiwic3ltYm9sT2JqZWN0Ijp7InN5bWJvbCI6Il5JWElDIn0sInBlcmlvZGljaXR5IjoxLCJpbnRlcnZhbCI6IndlZWsiLCJ0aW1lVW5pdCI6bnVsbCwic2V0U3BhbiI6eyJtdWx0aXBsaWVyIjo1LCJiYXNlIjoieWVhciIsInBlcmlvZGljaXR5Ijp7InBlcmlvZCI6MSwiaW50ZXJ2YWwiOiJ3ZWVrIn19fV0sInN0dWRpZXMiOnsidm9sIHVuZHIiOnsidHlwZSI6InZvbCB1bmRyIiwiaW5wdXRzIjp7ImlkIjoidm9sIHVuZHIiLCJkaXNwbGF5Ijoidm9sIHVuZHIifSwib3V0cHV0cyI6eyJVcCBWb2x1bWUiOiIjMDBiMDYxIiwiRG93biBWb2x1bWUiOiIjRkYzMzNBIn0sInBhbmVsIjoiY2hhcnQiLCJwYXJhbWV0ZXJzIjp7IndpZHRoRmFjdG9yIjowLjQ1LCJjaGFydE5hbWUiOiJjaGFydCJ9fX0sImN1c3RvbVJhbmdlIjpudWxsfQ%3D%3D" style="color: #954f72;">Yahoo! Finance</a><o:p></o:p></span></div>
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<span style="color: #353535; font-family: "applesystemuifont";">Join the conversation on Linkedin! – <a href="https://www.linkedin.com/pulse/q2-2018-real-estate-update-long-last-market-shifts-buyers-alan-wang">https://www.linkedin.com/pulse/q2-2018-real-estate-update-long-last-market-shifts-buyers-alan-wang</a><o:p></o:p></span></div>
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