Good News for All East Bay Real EState in fact!
It's been a while since I posted but I'm going to make an effort to change that.
At last it looks like we have a good chance of seeing more movement in the California real estate market this year. This looks like an opportune time...
Last week, Governor Schwarzenegger put his support behind the proposition to increase the conforming loan limits to $625,000 for California home loans in a letter to President Bush. Yesterday, Bush announced his support of increasing the conforming loan amount (possibly above $625,000) as part of his $150 billion stimulus package. The expectation is that the Stimulus Bill will be fast-tracked through Congress as early as next week and this will quickly be followed by Senate approval.
This means that the conforming limit for California home loans could possibly be increased above $700,000 as soon as next month.
The effect on many potential home buyers as a result of this increase will be significant. First of all, it should create impetus among first-time home buyers who will now be able to afford to get into the home ownership market. And remember that interest rates are still trending downwards which helps everybody.
This will create a knock-on effect as people who are planning to trade up to larger homes will now have a much improved chance of finding a buyer for their existing home more quickly.
Even without this significant change, I have been predicting that homes in Danville, San Ramon and surrounding areas in the San Ramon Valley and Lamorinda would maintain their existing value through 2008 and I also expected to see days on market remain at their present levels. In other words, a static year for real estate in Central Contra Costa County. Now, I expect to see much increased activity, starting with the mid-priced segment of the market (single family homes under $1 million) then spreading to lower and higher priced segments.
Will we see prices increase? Probably not until the excess inventory has been taken up but that could happen fairly quickly, after all, we are coming into Spring which is traditionally the busiest time of year for home sales. Certainly by the time we get through the Summer, I would expect to see at least a modest increase (say at the rate of 5% per year).
Whatever happens now, this has got to be the best possible news for the real estate market in the San Ramon Valley.
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