Real Estate Trends:
What to Expect in the Housing Market

1. Real estate experts see a slowdown in the Bay Area housing

Real estate experts see a slowdown in the Bay Area housing market due to the housing supply-and-demand imbalance. Despite having adequate housing supply, inflation, higher mortgage interest rates, and increased housing prices continue to impact housing demand and affordability. Many economists and housing analysts see these as indicators of a slowdown.

It is understandable why homeowners consider the threat of a potential market crash. However, it is essential to recognize that this is not a crash. We are only experiencing the early signs of a cooling housing market as a way to moderate the home price growth of the market. A cooling trend could be beneficial for us to get back to a more balanced and healthy housing market.

2. Will housing prices continue to drop in Q3 and Q4?

Mortgage rates have recently passed 5%, almost by 20% in the past three months and 38% compared to last year. As of the latter part of May 2022, Zillow reported that the median home price in the Bay Area increased by around 20% in the last 12 months. While no one can accurately predict future market trends, home prices are unlikely to go down in the coming months. Expect the appreciation rate to rise slowly in the second half of 2022.