Are you planning to buy your first home in Pleasanton, California soon? Congratulations! It’s a big step, and it requires a lot of research and planning. Our Pleasanton first-time buyer’s guide will get you started on the right foot. We’ll start with an update on the local housing market.
A Look at the Pleasanton Real Estate Market
Understanding the local real estate market helps you in several ways. For one thing, it gives you a sense of what you can afford in the current market. It also helps you when negotiating with sellers. But it all starts with market awareness. Here are some things you should know about the current housing market in Pleasanton, California, from a first-time home buyer’s perspective.
House values across the East Bay have risen steady over the last few years. For example, the Zillow Home Value Index (ZHVI) for Pleasanton, California rose by nearly 8% over the last year or so, as of July 2016 (source: Zillow.com). According to Trulia, the average price per square foot in this area rose from $475 to $510 over the last year.
It’s a supply and demand thing. We are seeing strong demand for housing across the entire Bay Area, but inventory is limited in many cities. There just aren’t enough homes for sale to satisfy demand, and this puts upward pressure on house values. First-time home buyers in Pleasanton should understand this dynamic before entering the market. In a competitive real estate market, buyers should be prepared to make strong offers based on recent sales data.
Meanwhile, homes on the higher end of the pricing spectrum appear to be leveling off. According to a recent survey by Coldwell Banker Residential Brokerage, the median sale price for an East Bay luxury home declined 1.8% in May compared to the same time last year, dipping slightly to $1,780,000.
Mike James, president of Coldwell Banker Residential Brokerage, cites a more balanced housing market as the main reason for the price decline. “The East Bay’s luxury market is starting to come back into a bit more balance between supply and demand as a few more listings come on the market,” he said.
So while prices have risen across the board, they’ve slowed some in the “luxury” home category. This is one of the reasons why it’s wise for first-time home buyers in Pleasanton to work with a real estate agent. An experienced agent can help you understand the nuances of the local housing market, including price trends.
Catching Up With Mortgage Rates
Here’s some good news for first-time home buyers in Pleasanton, California. Average 30-year mortgage rates have been hovering below 4% since the start of 2016, and they recently dropped even lower.
According to Freddie Mac, the government-controlled buyer and seller of mortgage securities, the average rate for a 30-year fixed mortgage dropped to 3.48% last week (ending July 1, 2016). That was the lowest it has been since 2013.
Here’s what Sean Becketti, chief economist at Freddie Mac had to say about it:
“This week’s survey rate is the lowest since May 2013 and only 17 basis points above the all-time low recorded in November 2012. This extremely low mortgage rate should support solid home sales and refinancing volume this summer.”
Of course, interest rates change all the time. So by the time you read this, they might have risen from the range mentioned above.
The bottom line: If you’re thinking of buying a home in Pleasanton, now might be a good time to do it. Rates are relatively low right now, but no one can predict how long they’ll stay that way.
More Tips for First-Time Home Buyers
In closing, here are some important takeaway tips for first-time home buyers in Pleasanton:
- Spend some time reviewing recent sale prices online, in the area where you want to buy. This will help you determine how much house you can afford with your budget. And speaking of budgets…
- Take a look at your gross monthly income and your monthly expenses. This is a good starting point for determining your housing budget. The goal is to be able to afford your mortgage payments and still have money left over each month for savings, emergency fund, etc.
- Consider working with a real estate agent. As a first-time home buyer, you’ll be less familiar with the real estate process and paperwork, compared to someone who has purchased a home before. An experienced agent will keep you on track and help you avoid potentially costly mistakes.
- Be flexible. You might not be able to find a home that meets all of your needs and wants within your budget. Chances are, you’ll have to compromise in one or more areas. If a home checks most of your boxes and falls within your price range, it’s probably a good candidate.
We hope you’ve enjoyed this guide for first-time home buyers in Pleasanton. Stay tuned to our blog for more tips and insight. We publish new information on a weekly basis to keep you in the know. And don’t hesitate to contact us with any mortgage-related questions you have.
Note: The mortgage rates mentioned above were industry-wide averages reported by Freddie Mac at the time of publication. Rates change constantly, and they vary from one borrower to the next based on credit qualifications and other factors.