Low interest rates plus low inventory ring in 2015

Happy New Year! I hope you had time since my last post to spend time with family and friends.

Last week saw the first real tour of the year, but inventory is likely to remain quite low for the next few weeks. I met with new potential buyers between Christmas and New Year, and there was truly nothing to show them! As an example, right now in Berkeley, Albany and Kensington combined there are only five active properties listed between $700K and $1M. In all of Oakland there are only 31 active properties in that range, and most of those have been sitting for some time. But by the time you read next month’s post I will expect the market to have come out of hibernation.

Interest rates are back to nearly historic lows
Interest rates are back to nearly historic lows

I’m predicting that this will be another active year, with a new wave of buyers urged on by very low interest rates. The average interest rate on 30-year fixed-rate mortgages fell below 3.75% last week. That’s the lowest level since May 2013. For the same week a year ago the average was 4.63%. Rates on 15-year fixed mortgages have slipped below 3%. So if you’ve been thinking about refinancing, this would be an excellent time to take action!

January is the month when so many people vow to take on major projects and this is a great time to get prepared. If you’re thinking about buying or selling this year, or know someone who is considering such a move, of course I hope you’ll give me a call so that I can help you achieve your goals. A couple of important steps to consider:

  • Talking with a lender: Getting your credit and financial affairs in order can take a few weeks or a few months depending on your situation. Meeting with a lender far in advance is a great first step to help determine what you can spend.
  • Investigating tax implications: While as a Realtor I can walk you through the details of a purchase or sale transaction, tax ramifications should be referred to your accountant. Selling or buying a home can have significant tax implications so it’s a great idea to get answers early in the process.

I’m starting off the year with a new group of agents to mentor. Red Oak Realty has hired six brand new agents, the first time in many years that has happened. They all are sharp, motivated folks with previous careers, and a passion for real estate.  I serve as their guide to the industry, teaching them best practices.  It’s exciting to influence a group that has no bad habits to undo! And I know that I will learn from their questions. It is a good challenge to be forced to explain how every aspect of real estate works. Wish me patience! And I send you my best wishes for much happiness and good health in 2015!

About the author