The super-heated housing market may be cooling down in the Bay Area, as multiple bids aren’t come in as fast as a few weeks ago, nor are over-bids.
Sunnyvale is a red-hot market and homes often sell within a week, maybe a couple of days, or even one day. But in this super-heated market we’ve seen a lot of buyers offering from $50,000 to $100,000 over the asking price. However, something has changed because now all of a sudden buyers are taking a breath before they make an offer.
A three bedroom, two bathroom house in Sunnyvale went on the market five days ago. As recently as a couple of weeks ago, multiple offers would have come in even before the first open house. However, Pertria real estate agent Barbara Lymberis says it’s taking a little longer.
“In this market it’s taking a little bit longer for buyers to make a decision to make an offer. I would say we’re probably looking at 10 days to two weeks before we start to see offers,” Lymberis said.
Lymberis and other agents told ABC7 News that buyers are moving slower because of a number of recent developments. Interest rates are inching up, past four percent now, after the Federal Reserve signaled it may ease its mortgage buying this fall. Higher rates will also make it more expensive for investors to borrow money to buy rental properties.
“It’s been multiple offers, overbidding, people buying with all cash, offers with no appraisal contingencies or any contingency whatsoever, which is a dangerous situation for anybody. I think buyers are getting frustrated with that,” Keller Williams Realty agent Quincy Virgilio said.
In recent months, buyers found themselves overbidding, and then discovering the house didn’t appraise for the contract price. So they would have to come up with the difference in cash in order to get a loan.
“Buyers overpaid because they had to, you know, in order to beat out the competition. A lot of buyers would pay more than they might in a balanced market,” Lymberis said.
But the bidding frenzy may be cooling off. The asking price for a three bedroom home in Sunnyvale is $879,000.
“I have not seen as many multiple offers in the last two weeks as I had before, and so I would say that we probably have a little cooling off period,” Cedar Mortgage Company broker & President Marge Nogosek said