🌟 I am firmly convinced that 2025 will be a more fortuitous year for all of us.
The year just ended was fraught with uncertainties, including a divisive presidential election 🗳️, high interest rates, and cruel weather. Add to this that Californians are having trouble obtaining fire insurance, and you can see it has really been tough. The COVID pandemic brought into stark relief how fragile we all are. The fallout from the pandemic, the very challenging political times we have gone through as a nation, and the pernicious epidemic of unkindness we’ve experienced has dampened most people's tolerance for risk. There has always been a huge divide between the haves and the have-nots, but the cynicism of the political debate across the country has made everything feel slightly hopeless.
In the world of real estate, this played out in many ways 🏠. Older people, who would ordinarily have moved into more functional situations, did not because of the low interest rates on their loans. Buyers who would ordinarily have bought did not because the extremely high interest rates scared them and made what they could afford unappealing. In fact, 2024 will go on record with the lowest rate of transactions in the past 30 years nationwide.
Sellers have had unrealistic ideas of their home values since the banner year of 2021, and they think prices are still rising. They are not, with few exceptions. In fact, less than 2% of homes have sold in the Bay Area. This is pretty normal for our region because we have some of the highest-priced houses in the nation. But in a year when so much was happening, it seemed like buyers took their marbles and went home, but not to new homes.
I think that with sellers getting more realistic about house values and prices dropping, buyers will start doing the math and realizing that if they get a house now—for significantly less, and they can refinance when rates go down—they will still be way ahead financially. Judging from the number of buyer calls I am getting, I think many of them are coming to this conclusion.
So, home sales will likely increase in 2025, not astronomically, but certainly enough to improve the market.
Now that the stresses of the holidays, election uncertainty, and pandemic fallout are behind us, we can focus locally on ourselves, our homes, and our community 🤝. The institutions we hold dear are strong and have survived horrors in the past and will again. Our Constitution is powerful, there is so much good in it; our forefathers anticipated challenges of every kind to this beautiful democracy of the people, by the people, and for the people.
In the meantime, let’s focus on a kindness revolution 💕. Let’s demonstrate as individuals that we are better than the mean petty tyrants of the world and that we can make a difference every single day by supporting our schools, our properties, our communities, our elderly, and our children. Let's get passionate about buoying one another up and collaborate on making this world a better place for everyone.
