Housing Watch: There's less competition, more options now for Valley homebuyers

Many sellers are having to lower the price of their homes and even offer concessions to make the deal more attractive.

Dale Yurong Image
Thursday, September 8, 2022
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Experts say the Central Valley is now in a 'soft' housing market, during which sellers may be outpacing demand.

FRESNO, Calif. (KFSN) -- The Valley's red hot real estate may be cooling down.

Experts say we're now in a 'soft' market, during which sellers may be outpacing demand.

Fierce competition sometimes led to bidding wars over the past two years.

But now many patient homebuyers are content to wait it out.

As a result, many sellers are having to lower the price of their homes and even offer concessions to make the deal more attractive.

Scott Reba of Prosperity Home Mortgage says there's 100% more inventory in the housing market than there was a year ago.

"There was a lot of buyer burnout," Reba says.

He's now seeing the most serious homebuyers cautiously step back into the market.

"I had clients that had written 15-20 different offers and got beat out and they got frustrated and stepped away from the market," says Reba.

Reba notes there is less competition for existing homes today - meaning more opportunity.

But at the same time, that house will also cost you more.

"Now that they're coming back to the market, they're coming back into the market at a higher interest rate. Almost 2% higher than if they were in the market six months ago or a year ago."

Those higher rates have helped lead to a softening of the market.

"Whenever the rates go up, the monthly payment goes up. Whenever the monthly payment goes up, the borrower's debt to income ratio is affected and it does have the potential to soften their purchasing power," says Reba.

But Reba adds if you find the home of your dreams, maybe you should think less about the interest rate and more about how much of a monthly payment you can afford.

Many expect the Federal Reserve to soon hike federal interest rates yet again - by three-quarters of a point - to curb inflation.