January 4-5, 2025

Weekend Open Homes & Market Analysis

The weekly update from The Home Factor Team of Realtors for the weekend of Saturday, January 4, 2025, and Sunday, January 5, 2025.

*The specific cities and districts covered in this market analysis report are Berkeley, Oakland, Piedmont, Albany, Kensington, El Cerrito, Richmond, El Sobrante, Pinole, Hercules, and Crockett. 

We’re  happy to provide a complete list of *all Inner-East Bay open homes for this weekend, please click here.

For Open Homes limited mostly to the Berkeley area, we're happy to share the ‘Ad Review’. The Ad Review is a private Berkeley publication of open homes. It has a pleasant format but is by no means an exhaustive list of open homes in the Inner-East Bay. 

For this week’s Saturday Open Homes ‘Ad Review’ please click here.

For this week’s Sunday Open Homes ‘Ad Review’ please click here. 

Happy New Year! The number of open houses for Sundays in the past 6 months peaked on 9/20 with 528 open houses, which is the typical post-Labor Day trend, but slowed down dramatically in the last 2 months of 2024 per the chart below. This slow down represents the normal seasonal trend each year for the period from mid-October until mid-January. The data for 12/1/24 (Thanksgiving) shows a pronounced dip which is typical for a major holiday, and declines again become the main feature as we bump along at the lowest level of inventory since this time last year. Per normal seasonality, we anticipate that inventory levels will begin to increase incrementally perhaps as soon as next week but bigger gains in inventory are not anticipated until the middle of February.

The distribution of listings in Oakland with an open house on Sunday relative to the Inner East Bay as a whole is at 64% which is close to the average of 66% over the past 2 months.

The last week in December and first week in January each year is generally the low point each calendar year for inventory. There are 50% fewer single family homes actively available on the market in Oakland this weekend compared to 2 months ago, for example. We have an unusual set of dynamics at play in the market: Mortgage rates ticked up after the Fed announced its first rate cut in September, and again following the rate cut in late December. This confuses the market, sidelining some buyers. And of course, we had a divisive election which will take a period of time for the money markets to digest and could cause ongoing volatility in money markets during the transition of power.

Pro Tip: Reach out to us to learn about, and to discuss homes that are sitting on the market longer than is healthy for their bottom line and where a deal might exist for you. This is a good time of year for deals on property that have not successfully found a buyer within 3 weeks of being on the market. 

Let’s look at the market activity for only single family detached homes in our biggest 3 cities in the Inner East Bay. Oakland, Berkeley, and Richmond. 

Here’s the market activity for Oakland over the past 2 months for single family detached homes, not including condos or townhouses. The number of active listings has slowed down consistently from last year's high water mark of 620 on September 11, and the number of homes going under contract has also slowed, but homes are going under contract at a faster pace than the general decline in new inventory. We are bumping along at the lowest level of inventory since this time last year but will expect levels to increase perhaps as soon as next week.

Here’s the market activity for Berkeley over the past 2 months for single family detached homes, not including condos or townhouses. The number of active listings has fallen over the past month, and the number of homes going under contract has also slowed in the past couple of weeks. The bulk of existing inventory at this point is not being embraced by buyers. This is a great time of year if you’re shopping for a deal, otherwise buyers will need to wait until mid-January before they can expect a variety of new  listings of any great quality, and sellers will need to rethink their strategy for success. We are bumping along at the lowest level of inventory since this time last year but will expect levels to increase slowly perhaps as soon as next week.

The data for Richmond for single family detached homes, not including condos or townhouses, also points to a slow down in new listings, and with homes going under contract at a reasonably consistent rate over the past month. It’s a slightly different situation than in Oakland or Berkeley: Active inventory is higher than last week by 2 units, but still we’re bumping along at the lowest level of inventory since this time last year.. 

Days on market for Condos & Townhomes is longer than for Single Family Homes by quite a bit. Please let us know if you’d like more detail on this aspect of the market. It's a great time to shop for a condo or townhouse in almost any part of the Inner East Bay. Most real estate agents will tell you that in a market downturn, condos and townhouses are the last type of property to recover. Single family homes tend historically to recover value more quickly following a market downturn. 

Open Homes for Sunday, January 5: Let’s break it down:

Of the 57 single family residential homes that have an open house, 5% had a price adjustment. The data over the past several weeks revealed an uptick in cancellations rather than in price adjustments. Many sellers with property languishing on the market in the past several weeks opted to cancel their listing rather than adjust the price down. See below for more information on cancelations.  

Of the 44 condos/townhouses that have an open house, only 1 had a price adjustment in the past week. There continues however to be significant opportunities in the current, weak condo market in most East Bay cities for potential buyers. The average days on market for condos and townhouses in the Inner East Bay is currently at 86 days. Understanding the cancellation rate of listings is also important and there’s more on that below. 

Listings canceled from the Multiple Listing Service in the past 7 days:

A total of 43 listings were canceled from the Multiple Listing service in the past 7 days across all price points. The graph shows a significant pop in cancellations for the last ½ of December, especially for single family homes, but the rate is slowing.

Most (but not all) cancellations are in Oakland. Cancellations reveal that sellers are pulling underperforming listings from the market, if they can afford to, in favor of possibly re-listing them in the Spring, or, in some cases, renting them. The pop at the end of the year is not unusual. Cancellations are also an opportunity for buyers because the sellers may still be open to offers. The list is worth reviewing. Click here for a full list.

A quick word about mortgage rates in general since home mortgage rates have been top of mind for consumers in the past few years: Since September the Federal Reserve has cut rates by 1% but mortgage rates have ticked up in the past month causing confusion among consumers. Federal Reserve rate cuts do not directly correlate to reduced mortgage interest rates. As more seasoned mortgage rate watchers know, a better way to understand the direction of mortgage rates is to track the yield on the 10-year Treasury bond. The 10-year Treasury bond yield is the interest rate the U.S. government pays to borrow money for a decade, serving as a benchmark for other interest rates and a key indicator of investor sentiment about economic conditions. The 10-year yield is used as a proxy for mortgage rates. As the yield on the 10-year Treasury bond increases, typically so too do mortgage interest rates, and as the the yield on the 10-year Treasury bond declines, mortgage interest rates typically follow the same pattern.

Pro-tip: It’s worth also considering the impact of elections on the current year and what historic data can tell us about elections' impact on the following calendar year. Click here for our July 2024 Newsletter with a feature on “The Impact Of Elections”.

Just a reminder, there are some truly gorgeous houses out there to visit this weekend. You may also want to share this weekly deep dive with friends or family in the east bay who might appreciate the opportunity to visit the beautiful open homes on offer, or who, better still, might truly appreciate the consistent care and effort The Home Factor takes with interpreting the real estate market data in the east bay each week.

That’s the wrap up for this weekend! Please don’t hesitate to reach out for custom information. We’re always happy to provide it. Best way to reach us is at declan@thehomefactor.com 

Declan Spring is consistently a top production realtor in the East Bay and Berkeley, Albany and Richmond. He is respected by clients and colleagues alike.

Declan Spring is among the best real estate agents and realtors working in the East Bay, Berkeley, Albany, El Cerrito, Richmond, El Sobrante, Kensington, Pinole, Hercules, and Oakland. Time and time again his clients review him with 5 stars and extraordinary compliments. Declan Spring receives most of his business by referral. He does not need to rely on traditional marketing because people are always lining up to work with him through word of mouth and by referral. He’s known as “the realtors realtor” because he gets a lot of referral business from industry professionals. How would you like to work with a realtors realtor? Declan Spring has a stellar industry reputation and consumers are generally not aware that being well known and respected in the agent community and industry is a super power for Declan’s clients.