Mortgage rates rise 2x the rate of home prices
According to CoreLogic, the US median sale price of a home has risen by close to 6% over the past year; however, the mortgage payment on that median-priced home has increased around 13%.
In addition, the forecast for US home prices will rise 4.3% in 2019, which means new homebuyers will be paying more than twice that rate. Based on these projections, the inflation adjusted typical monthly mortgage payment has risen over 7% since 2018. Even so, this is lower than the peak of 2006.
The Winds of Change are Coming
Stagnant inventory continues to abound and has been trending down for the last five years. In 2018, inventory reached the lowest level in a generation.
Rising interest rates reached record lows in December 2008, when the FED lowered its benchmark rate to .25 but now rates have been inching upward since 2015. By 2020, the FED predicts rates will be at 3%.
Reduced affordability will continue to be a major obstacle in 2019. According to the Pew Research Center, the real average wage had about the same purchasing power in 2018 that it did in 1978. Elections for new local, state and federal lawmakers impact policies affecting the housing market such as; Trade, Deregulation, Tax Reform and Immigration.
There are some advantages to selling in the SPRING, for example: The spring has a large number of Buyers, therefore more demand from people looking to get into their new home before school starts in the fall. Sellers often feel their homes look more appealing in the spring and summer. In colder climates, the weather itself is easier for buyers to deal with.
February Sales Statistics Locally & in the Bay Area
With buyer demand reduced and more active inventory on the market, competitiveness over existing units has subsided in recent months.
Each January, the annual Consumer Electronics Show (CES) showcases cutting-edge technology by companies from around the world. This year, home automation showed up in a big way, including these unveilings for tech-loving homeowners.
1. Smart Mirrors
Capstone Connected Home is launching a Google-enabled smart mirror that responds to voice or a touch-screen keyboard, like your favorite tablet. Watch videos, view your schedule, check traffic and weather, access Google Drive, and type out an email while getting ready for work! (Available soon; price not disclosed.)
2. A “Disappearing” Television
LG has been playing with flexible screens for several years but is finally bringing its 65-inch 4K version OLED television rolls up and down from a base that includes a high-end built-in sound bar.
3. A Peephole Smart Camera
Ring is adding a Door View Cam that converts a front door peephole into a smart security camera.
4. Robot Vacuums with AI
The Deebot Ozmo 960 from Ecovacs uses artificial intelligence and visual interpretation (AIVI™) to create a vacuum that won’t suck up the wrong things while cleaning up after you. (Available later this year; price not disclosed.)
These are just a few of the many new and improved consumer electronics products releasing this year and beyond. Other categories include new smart smoke and CO2 detectors, smart power strips, and smart speakers.