It's here — the end of the first quarter of 2023. And it’s not ending without its share of major events getting national and global news attention. This includes the collapse of Silicon Valley Bank — a headline that shocked homeowners, real estate investors, and everyday individuals alike. In today’s article, Mareijke Weidemann, the real estate expert at Homes With M, is going to dissect what this news means for the Bay Area housing market, and what you need to do to keep your investments safe. We will cover:
What the Silicon Valley Bank Collapse means for housing here in the Bay Area
Why housing prices in our area will NOT crash
What we are doing to bolster our finances during uncertain times
Your regular Housing Market Update
The Silicon Valley Bank Collapse Means…
With the FDIC making all depositors of Silicon Valley Bank whole, we escaped what could have been an even more enormous immediate fallout with the failure of this local bank. The Fed has done its share of campaigning around why you and I should not worry about our deposits at other banking institutions. But you might still be wondering how this will impact you and the value of your home.
The housing market is going to respond to this event, but not in the way many might think.
It will be bad for the stock market, which means good for hard assets. We will see money flow to precious metals and real estate.
With housing inventory levels terribly low already, upward pressure will continue for housing prices.
It is already slowing the pace at which the Fed is increasing interest rates at.
Media Weak, Housing Strong
If you watched my latest video, you would know that the media is misrepresenting the housing market once again. Despite their claims that housing prices are declining to levels of crisis, the truth is that the median home price is only appearing to go down because more lower-priced homes are being sold relative to expensive luxury homes. When you look at more accurate data, you can see that housing prices are continuing to steadily trend upward.
Another reason the Bay Area housing market remains strong is that California mortgage delinquencies remain low:
California finished 2022 with just 2.5% of mortgages behind on payments, far below the historical average of 4.2%.
California now has the 3rd lowest delinquency rate of any state in the nation.
Homeowner equity remains near an all-time high level, so homeowners are not being forced to sell.
Most homeowners are locked into the lowest-rate mortgages of all time, and they will fight to protect their most precious asset.
Thinking of Buying or Selling in 2023?
If you’re considering buying or selling a home in the Bay Area this year, book a strategy call with me and we can help you get your plans into motion! We also recommend joining our mailing list to stay up to date on all of the latest news regarding the Bay Area housing market.
Talk with you soon,
And before we go, here’s your Bay Area Housing Market Update. Notice that all of the numbers are trending up over the previous month!