What’s Motivating Homeowners To Move Right Now
Over the past few years, many homeowners in North County San Diego have chosen to delay their move, hesitant to sell and face a higher mortgage rate on their next home. If this sounds familiar, you're not alone—it’s a common challenge that has significantly kept housing inventory low in the area. However, for many, life doesn’t stay on pause. Personal or lifestyle changes are motivating homeowners to make a move, even if it means navigating today’s market. As Redfin explains: “Some homeowners opt to bite the bullet and give up their low rate to move. Many are selling because of a major life event like a job change, or divorce . . .” If you’re weighing the decision to move, look at some of the top reasons others are choosing to sell. You might find those are reason enough for you to move now, too. It’s Time for a Change A new job in another city, wanting to be closer to family, or seeking a change of scenery can all spark the need to sell your home. For homeowners in North County San Diego, these types of life changes often make moving a priority. For instance, if you’ve received an exciting job offer that requires relocation, listing your current home quickly could be the next logical step. There’s Just Not Enough Space in Your Current House Sometimes, your current home just doesn’t fit your lifestyle anymore. A growing family, the need for a home office, or more room for entertaining can all drive the decision to upgrade to a larger space. As an example, if you live in a condo and have a baby on the way, selling might be the next best move so you can find a larger home that suits your needs. Retirement or Wanting To Downsize On the flip side, some homeowners are ready to downsize. This could be due to children moving out, retiring, or simply wanting less to maintain. If you’re newly retired and dreaming of a simpler lifestyle, downsizing to a smaller home could free up both time and resources to enjoy this new chapter of life. Changes in Relationship Status Big changes like divorce, separation, or marriage often lead to a need for new living arrangements. If you just went through a divorce, selling the house you once shared may allow both of you to move forward and find a living situation that works better for you now. Health and Mobility Needs Health concerns, especially those that affect mobility, can also drive the decision to sell. A home that once worked well might no longer suit your needs. If this sounds like your experience right now, selling your current home to move into a more accessible space, or even using the proceeds for assisted living, could significantly improve your quality of life. Bottom Line Selling your home isn’t just about current market trends or mortgage rates—it’s about making the best choice for your lifestyle and future. As Bankrate puts it:“Deciding whether it’s the right time to sell your home is a very personal choice. There are numerous important questions to consider, both financial and lifestyle-based . . . Your future plans and goals should be a significant part of the equation.” For homeowners in North County San Diego, whether it's a career change, family needs, or a shift in lifestyle, now could be the right time to move. At Shafran Realty Group, we understand these pivotal moments and are here to guide you through every step. Let’s connect to ensure you have an experienced team on your side to help make the transition smooth and successful.
What To Look For From This Week’s Fed Meeting
You may hear a lot of talk about the Federal Reserve (the Fed) and how their actions could impact the housing market in North County San Diego. Here’s why it matters. This week, the Fed is set to meet to determine the next move for the Federal Funds Rate, which dictates how much it costs banks to borrow from each other. While the Fed doesn’t set mortgage rates directly, their decisions can significantly influence them. If you’re considering buying or selling a home in North County San Diego, understanding how these changes affect mortgage rates is essential. Here’s a quick overview to help you anticipate what might come next. The Fed’s decisions are driven by three main economic indicators: The Direction of Inflation How Many Jobs the Economy Is Adding The Unemployment Rate Let’s take a look at each one. 1. The Direction of Inflation You’ve likely noticed prices for everyday goods and services seem higher each time you purchase at the store. That’s because of inflation – and the Fed wants to see that number come back down so it’s closer to their 2% target. You’ve probably noticed that prices for everyday goods and services in North County San Diego seem to rise each time you shop. This is due to inflation, which the Fed aims to reduce to their target of around 2%. Currently, inflation remains above that target, though it has shown some positive trends. Despite occasional fluctuations, inflation has been gradually decreasing over the past two years and is now holding relatively steady. This is important because the Fed’s actions, aimed at controlling inflation, can influence mortgage rates, which in turn affect the local housing market in North County San Diego. (see graph below): The path of inflation – though still not at their target rate – is a big part of the reason why the Fed will likely lower the Fed Funds Rate again this week to make borrowing less expensive, while still ensuring the economy continues to grow. 2. How Many Jobs the Economy Is Adding The Fed is also keeping an eye on how many new jobs are added to the economy each month. They want job growth to slow down a bit before they cut the Federal Funds Rate further. When fewer jobs are created, it shows the economy is still doing well, but gradually cooling off—exactly what they’re aiming for. And that’s what’s happening right now. Reuters says: “Any doubts the Federal Reserve will go ahead with an interest-rate cut . . . fell away on Friday after a government report showed U.S. employers added fewer workers in October than in any month since December 2020.” Employers are still hiring, but just not as many positions right now. This shows the job market is starting to slow down after running hot for a while, which is what the Fed wants to see. 3. The Unemployment Rate The unemployment rate shows the percentage of people who want jobs but can’t find them. A low unemployment rate means most people are working, which is great. However, it can push inflation higher because more people working means more spending—and that makes prices go up. Many economists consider any unemployment rate below 5% to be as close to full employment as is realistically possible. In the most recent report, unemployment is sitting at 4.1% (see graph below): Unemployment this low shows the labor market is still strong even as fewer jobs were added to the economy. That’s the balance the Fed is looking for. What Does This Mean Going Forward? Overall, the economy is headed in the direction the Fed wants to see – and that’s why experts say they will likely cut the Federal Funds Rate by a quarter of a percentage point this week, according to the CME FedWatch Tool. If that expectation ends up being correct, that could pave the way for mortgage rates to come down too. But that doesn’t mean they’ll fall immediately. It will take some time. Remember, the Fed doesn’t determine mortgage rates. Forecasts show mortgage rates will ease more gradually over the course of the next year as long as these economic indicators continue to move in the right direction and the Fed can continue their Federal Funds rate cuts through 2025. But a change in any one of the factors mentioned here could cause a shift in the market and in the Fed’s actions in the days and months ahead. So, brace for some volatility, and for mortgage rates to respond along the way. As Ralph McLaughlin, Senior Economist at Realtor.com, notes: "The trajectory of rates over the coming months will be largely dependent on three key factors: (1) the performance of the labor market, (2) the outcome of the presidential election, and (3) any possible reemergence of inflationary pressure. While volatility has been the theme of mortgage rates over the past several months, we expect stability to reemerge towards the end of November and into early December." Bottom Line While the Fed’s actions play a role, it’s the broader economic data and market conditions that truly drive mortgage rates. For those in North County San Diego, this means paying attention to these factors is key when considering real estate moves. As we move through the rest of 2024 and into 2025, mortgage rates are expected to stabilize or gradually decline, bringing more predictability to what has been a volatile market. At Shafran Realty Group, we’re here to guide you through these changes and help you navigate the North County market with confidence.
Why Home Sales Bounce Back After Presidential Elections
With the 2024 Presidential election just around the corner, many are curious about how it might shake up the housing market—especially here in North County San Diego. Let’s dive into the exclusive insights on what buyers, sellers, and homeowners can expect as election season heats up! Election Years Bring a Temporary Slowdown In any given year, home sales slow down slightly in the fall. It’s a typical, seasonal trend. However, according to data from BTIG, in election years there’s usually a slightly larger dip in home sales in the month leading up to Election Day (see graph below): Why? Uncertainty. Many consumers hold off on making major decisions or purchases while they wait to see how the election will play out. It’s a pattern that’s shown up repeatedly, and it's particularly apparent for buyers and sellers in the housing market. This year is no different. A recent survey from Redfin found that 23% of potential first-time homebuyers said they’re waiting until after the election to buy. That’s nearly a quarter of first-time buyers hitting the pause button, likely due to the same feelings of uncertainty. Home Sales Bounce Back After the Election The good news is these delayed sales aren’t lost forever—they’re just postponed. History shows sales tend to rebound after the election is over. In fact, home sales have actually increased 82% of the time in the year after the election (see chart below): That’s because once the election dust settles, buyers and sellers have a sense of what’s ahead and generally feel more confident moving forward with their decisions. And that leads to a boost in home sales. What To Expect in 2025 If history is any indicator, that means more homes will sell next year. And based on the latest forecasts, that’s exactly what you should expect. As the graph below shows, the housing market is on pace to sell a total of 4.6 million homes this year, and projections are for 5.2 million total sales next year (see graph below): And that aligns with the typical pattern of post-election rebounds. In North County San Diego, it may feel like the market is cooling off, but this is likely just a temporary dip, not a lasting trend. As we've seen in past election years, once the uncertainty lifts, buyers and sellers typically return to the market here with renewed confidence and energy. Bottom Line It’s important to remember that, while election years often bring a short-term slowdown in the housing market, this pause is typically temporary. Here in North County, those sales are not lost. Data shows that home sales often see a boost the year following a Presidential election, and forecasts indicate 2025 will be no different. If you’re waiting for a clearer picture before making a move, know that North County's market is expected to pick up speed in the months ahead. Shafran Realty Group will be here every step of the way to help you make the most of it!
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