Would market conditions be better by 2014 in California Bay area?

Asked by Home Owner, San Jose, CA Thu Jul 26, 2012

Specifically, I am wondering about the Morgan Hill area. Would home prices rise in the coming years? 2013 and 2014? Or would things get worse before better?

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10
Tina Lam, Agent, San Jose, CA
Fri Jul 27, 2012
If we use the south bay area as a proxy, then you should expect solid to above average performance in Morgan Hill in the coming years. Since Morgan Hill offers homes at a significant discount to those in cities around the south bay, then by the basic concentric theory of property values, buyers will be flocking there.

Prices in the south bay for homes under $500K have gone up by double digits this year already, forcing buyers with that budget to look further afield, like in Morgan Hill. But, for higher end homes in Morgan Hill, I don't see as much of an immediate drive upwards in price.
Web Reference:  http://www.archershomes.com
1 vote
Angela Lazro…, Agent, Morgan Hill, CA
Fri Feb 21, 2014
The market forecast is saying yes things are going to be better in 2014.
We are seeing less foreclosure and short sales. Past underwater home owners are re-gaining equity.
0 votes
Michelle Car…, Agent, Coppertino, AL
Sun Aug 25, 2013
Are you trying to decide whether to sell now or in 2013 or 2014? Many factors will influence this. I'll gladly provide this info to you if you like.

First, look at the past to see what the trend has been in value, then look at today. We are going in to the fall which is generally when prices are softer and the market slow down.

However if interest rates go up or down (they are expected to go up), that affects affordability for buyers.

Should a huge world economic event occur (terrorism, a country's economy failure, etc.), everything changes.

The capital gains tax exemption is set to expire ($250K for singles, $500K for couples) which will also affect the market.

My best advice is to get the right data, pray for wisdom and make the best choice for you today. There is no guarantee tomorrow will bring you more money.
0 votes
Ron Thomas, Agent, Fresno, CA
Mon Mar 25, 2013
I remember all the similar questions as the Market was on a downward curve:
Now, we get the upward-curve questions.
I hope that fence is comfortable.
0 votes
wontonsoupzz, Home Buyer, Morgan Hill, CA
Mon Mar 25, 2013
How will the market be along the coast in Motara,Half moon bay? for 2014
0 votes
Terri Vellios, Agent, Campbell, CA
Fri Jul 27, 2012
I'm shaking my magic 8 ball right now... answer Reply hazy, try again.

Seriously. We all wish that we could predict the market. All we can do is educate people on what the past has shown and what the current market is doing, and how certain events affect the future.

Back in the boom of the market when housing prices where increasing daily, Cisco Systems was going to move to Morgan Hill. This news spurred builders and home buyers to go south. Prices where jumping up. When Cisco didn't go in everyone who banked on Cisco were faced with challenges. New stores, restaurants, builders, and home buyers.

When the gas prices went up to nearly $5.00 a gallon this made an impact on where people were willing to commute from.

When the bubble popped Morgan Hill, So. San Jose, Tracy, etc. were hit pretty hard.

Now as our market has once again heated up, buyers are not finding what they want in a price they can afford, so they are making concessions, this being commute time and cost. Therefor, they are looking towards Morgan Hill because they can get more house for their money. It's a wonderful community which still has a good amount of open space.

In today's market Morgan HIll has experienced multiple offers and prices are getting better. If our interest rates were to increase by 1% that affects a buyer buying power by about 10%. That will either mean they have to make more, pay less or put more money down. So do we think interest rates will go up? I think so. I don't' know when. And will people still be buying and selling houses. Absolutely!

As for where the prices will be, no one can answer this with certainty.
Web Reference:  http://www.terrivellios.com
0 votes
Bob Lasswell, Agent, Morgan Hill, CA
Fri Jul 27, 2012
This is the best market in 5 years. Interest rates are low. Banks have money to lend. Appraisers are being nice. Demand is high. The economy is good and expected to get better. Economy is historically good around an election. What would make it better?

Are you asking regarding the value of your home? Prices are going up. Will they continue up into 2014? No one can predict that. If you are selling to buy another house... It does not matter as much. If you are renting better not wait.
0 votes
John Wunderl…, Agent, Morgan Hill, CA
Thu Jul 26, 2012
Hi Home Owner,

Thanks for posting your question.

Prices are trending up throughout California, the Bay Area, and specifically the South County area which includes Morgan Hill. I have seen homes in Morgan Hill that didn't sell last year, re-listed this year and sold for higher than the price from last year.

Interest rates are at a historic low and inventory is about half what it was last year so it is a seller's market and prices will likely continue to rise, although hopefully not at the meteoric rates we saw before the bubble. We bottomed out in early 2009 and floundered around for three years but for some reason this year the buyers (and investors) are out in force. It is especially competitive at the entry level, below $500k for houses and for condos.

There are only 98 houses on the market in Morgan Hill with 127 pending sales! There are only six condo/townhouses on the market and 27 pending! That's unheard of for a town with so many of these types of homes.

If you are considering buying or selling, I would be happy to help, my office and home are located in Morgan Hill.

John Wunderlich
Broker-owner / Realtor
Wunderlich Realty
(408) 201-4007
0 votes
Lee Schmidt, Agent, Morgan Hill, CA
Thu Jul 26, 2012
Are you asking as a buyer or seller? As a seller, I can't imagine it getting any better. Interest rates are at historic lows, inventory is low and most homes are getting multiple offers which drive prices up. I would not wait since things can only cool down. As a buyer, you might want to wait because as I stated above, things are red hot and time can only work to your benefit.
0 votes
Elena Talis, Broker, Palo Alto, CA
Thu Jul 26, 2012
It depends... Elections, economy, demographic changes, China, Greece, etc., etc., etc. As it is developing right now, the population of Bay Area is on the rise due to a robust high-tech economy and housing is in short supply. The ground zero for the housing shortage is Silicon Valley - Palo Alto, Mountain View, Menlo Park, Los Altos, Cupertino, Sunnyvale. If economy of the Bay Area will still be as good as now in the next 12 to 24 months, this housing pressure will have to spill into surrounding communities including Morgan Hill. Anyone with a crystal ball?
0 votes
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