A drop in housing prices by about 7% translates to more than a $100,000 in savings on a typical Bay Area home.
But a rise in mortgage rates to about 7% all but erases that savings.
“In the Bay Area, you’re looking at thousands of dollars a month more in mortgage than in just January of this year,” said Nicole Bachaud, a senior economist at Zillow.
For many, especially young buyers, the drop in housing prices is still not down far enough.
“If I do well in my job, I can save up and eventually buy a house,” San Jose resident Julien Chairez said. “But in this economy, and in this market in this area, I still don’t think it’s possible.”
There are more numbers heading in a downward direction:
- In San Jose, fewer than 40% of homes that sold went for above asking price last month — at this time last year the number was 70%.
- In San Francisco, 60% of homes sold for above asking price last month compared to 80% last year.
Source: NBC Bay Area