Today we celebrate and remember Martin Luther King Jr. for his iconic civil rights activism, who is honored for his contributions to the country and the world. For more information about events throughout the Bay Area, click the link below. #MLKDay http://ow.ly/NxK33083ySy
We are specialized in the Oakland Neighborhoods of the Bay Area. Here are some fun facts about the city we call home, Oakland! http://ow.ly/kcjx3083x1p
Ellen Diamond and Lisa Cartolano are the dynamic duo that had an incredible 2016 year for their Home Buyers. Let this team of professional and skilled Real Estate Agents help you find your dream home in 2017. For more information on how to contact Ellen or Lisa please email at Team@ViewEastBayHomes.com
A lot has changed since we last wrote. The election is over and Trump is the president elect. No matter your political leanings or beliefs, Trump has laid out some very different ideas and promises that are in contrast to the current administration.
While predicting the future is not a strategy we advise, there are some indications that things will change, how much, to what extent is hard to say. As we always say, if we could predict the future, we wouldn’t be working for living. That being said, there are some indicators that you can make some educated estimations.
- Interest rates. They have already gone up recently and probably will continue some. This could have a dampening of the current frenzy in the local market. Lets be honest though, even an interest rate of 4%, while higher than it has been, is still historically low. With the Bay Area housing market and prices surging from the last bubble, we think there will be a more of a balance in the market between buyers and sellers. There is a softening already at the upper end of the market, but the entry level priced homes are still seeing pretty brisk competition.
- Potentially Deregulation. According to an article in RisMedia the Trump camp has not specially said what they are going to do, if anything, but hinting at repealing the Dodd-Frank regulations. This is really a double edged sword. The lending requirements have had a major pendulum swing in the last decade or so. In the early 00s, it seemed like all you had to do was fog a mirror to get a loan. There was a lot of looking the other way. (Watch the Big Short). Then the bottom fell out and after that the pendulum went far to the other end. Almost feels like you have to provide DNA samples to get a loan, and if your self employed…. it is challenging. Would some changes to make credit easier? Yes. Do we need to go back to the land of stated income, anything goes? No.
- Potential Changes to Fannie and Freddie. This is a really interesting point in the RisMedia article this point has been made in a few other publications. This is the one area that honestly probably could have the biggest impact on the housing market. There has been a push afoot from Rep. Jeb Hensarling, R-Texas, chairman of the House Financial Services Committee to dismantle the Federal backed mortgages. this would severely reduce the available lenders and mortgages would only be available to a much smaller segment of the population. Let’s hope they don’t throw the baby outwith the bathwater so to speak. We can imagine there will be huge uproar over this and there would be a lot of push back. It will be very interesting to see if this idea even comes to fruition.
- The Bay Area and Philosophical Differences. Let’s be honest, we live in a relatively left leaning area where there are definitely a lot of philosophical differences with the Trump camp. We live in an amazingly diverse area and we all work with, go to school with, live with all kinds of different people from different walks of life. It is pretty awesome. By living in this big mixing bowl of sorts, there is definitely a different perspective on how we treat immigrants, cultural and religious differences, different races, sexual orientation, the list goes on. These differences and how our state, regional and local government will chose to implement, or not implement, any of the Trump related policies could be interesting. The New York Times this week had and article regarding “sanctuary” cities and how response from local mayors.
So how will it all change? Probably not drastically. The real estate market constantly changes. Has it ups and downs, interest rates change, local laws change, federal guidelines change. This is nothing new and yes there will be changes. It is the fact of the market. the reality is we all need to live somewhere. If our jobs and families are here, we are either looking to rent or buy. That will not change.
The Bay Area is still considered an area where people want to live and work. As two transplants from NJ, we can tell you this place is pretty amazing. The business innovation, the weather, the cultural diversity, the beauty of area are draws to be here and will continue to be.
As published in the San Franciso Business Times, a recent poll the reveals many Oakland Residents favor encouraging bringing more of the Tech Sector businesses to Oakland to help simulate the local economy and to promote more development.
The poll was completed by the Oakland Metropolitan Chamber of Commerce. They polled 600 likely voters to gather their opinion on development in Oakland. Granted this is a pretty small sub-set of Oakland residents (it’s a pretty big city!), but is helps to give at least an overall feel of how some residents feel in Oakland.
Oakland is definitely having some growing pains as well. Developers have indicated that constructions costs are too high and rent too low. Despite this there have been several New Projects in Oakland approved in the last couple of years. There are some hurdles to further development as well. Four of the proposed housing projects have been appealed by local community group and labor unions. A tower at MacArthur BART stations is being opposed by neighbors who say it is too tall.
Not only is there a lack of housing, there is a lack of available office space. The office rental occupancy rate is less than 5% in Oakland.
A lot of give and take will be needed by developers, the City and its residents as Oakland becomes more popular. More housing is definitely needed to meet the growing demand, and having businesses establish themselves here helps to provide a larger economic engine for the city. Time will tell how this all works out.
It looks like Google the next Tech company setting their sights on Oakland. As reported in the San Franciso Business Times, Google has signed a lease at the Fruitvale BART transit station. This will be Google’s first Oakland location.
According to sources stated in the article, the idea is for Google to train local residents in technology and entrepreneurship. The center is estimated to open in October.
The Fruitvale Transit Village is a mixed use complex with retail, office and housing developed and owned by the Unity Council, a local non-profit.
This arrival in Oakland appears to dovetail into Googles effort to ramp up its civic efforts after the tech giant has often been called out for lack of diversity in hiring practices. The full extend of the Oakland location and exactly what type of business services that will offered still remains to be seen.
On Wednesday the Fed held interest rates where they are
“The Committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives,” the Federal Open Market Committee (FOMC) released in statement. “The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run.”
The historically low interest rates do appear to have an affect on the local real estate market. With money cheap to borrow, buyers are taking advantage.
It will be interesting to see how mortgage rates will actually rise if the Fed does decide to raise rates in December.