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Do the Latest Numbers From Our Market Indicate Our Expansionist Economy Is Ending?

September 05 2018
September 05 2018

Thus far, the consensus that our expansion economy is coming to an end hasn’t affected homes prices in Silicon Valley and San Francisco.

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With fall just on the horizon, the current change of seasons has many wondering whether our market, too, is beginning to shift.

"Year over year, single-family home prices are up 14%, and condos are up 4%."

Fortune Magazine recently published an article titled “The End is Near For the Economic Boom,” and this article echoes a cautionary sentiment shared by many economists, investors, and real estate agents that the expansion economy we’ve experienced for the past decade or so may be coming to an end. Facebook’s recent 20% drop and Netflix’s 18% drop in share price certainly forecast a cloud over homebuyers’ outlook in tech-dependent San Francisco and Silicon Valley.

However, this hasn’t shown up in housing prices. Year over year, single-family home prices are up 14%, and condos are up 4%. Interests rates, meanwhile, are holding steady at 4.5%, and the Federal Reserve hasn’t signaled an increase in rates for the rest of the year. Keep in mind, the general rule of thumb is a 1% increase in rates translates to a 10% drop in buying power.

If you’re thinking about buying, selling, or investing in real estate, or you have any further questions about what’s happening in our market, please feel free to give us a call. We’d love to help you.


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