The real estate market is always characterized as a series of ups and downs. In the greater San Francisco Bay Area, the past 30+ years have been characterized, more than anything, by spiking prices, with one spectacular crash in 2008-2009. Aside from that historic debacle, the few years where the market declined, prices went down only moderately and were soon back on their way up again.
Even so, there’s always the fear that the Silicon Valley real estate market is about to bust, or perhaps enter some kind of period of protracted decline. Recently, the CEO of Compass did an appearance on CNBC to talk about the national real estate market. While the Bay Area market is of course singular in the nation, it is not immune to national trends.
For the first time in 10 months, all the statistics I look at are trending positively.
–Compass CEO Robert Reffkin, CNBC
The six reasons why Compass CEO Robert Reffkin believes Q4 of 2022 was the bottom of the recent real estate market cycle are:
- 25% increase in weekly mortgage applications.
- Mortgage rates continue to move down to a 4-month low.
- Increase in buyer interest, open house traffic, and offers.
- In the last quarter of 2022, 42% of sellers were giving concessions to buyers at the closing table, a 10-year high.
- Home builder sentiment improved for the first time in 1 year.
- Pending closings were down 30+% at points in the fall but over the last few weeks, we have seen pending listings in most of our markets nearly flat year over year.