Don’t get me wrong; I understand the situation as well as anybody. The California economy is in shambles and the unemployment rate is holding steady at roughly 10%. But, if one expert is to be believed, the California real estate market may be a bright spot on an otherwise bleak horizon. Professor of Economics at Wellesley College and co-creator of the Case-Shiller Housing Index, Karl Case had this to say on NPR's "All Things Considered
Carl Kase says, "If you look at places, particularly California, which is a quarter of the value on the country, believe it or not, California is up substantially. Look at the coastal towns. San Francisco is up 21 percent actually from the very bottom. Eventually, when prices get down low enough, people are going to buy this property, all right?
And they're going to buy it up and they're going to live in it. And by all historical standards, they're getting a pretty good bargain right now.
If you look at a $300,000 house, three years ago, the house payment on an 80 percent mortgage would have been $1,500. Today, the same house is 30 percent lower on average and the same mortgage at 4.1 percent gives you a house payment of about $800."
And don’t forget that San Francisco is one of the most insulated housing markets in the country (because of the limited available land mass). “San Francisco is up 21 percent actually from the very bottom,” is not hyperbole. While the rest of the state and country remain mired in recession, look for prices in The City to rebound faster than the national average.
So, what does this mean for you? Well, if you currently have the means to purchase a home (either through loan qualification or “King Cash”), you have a choice. You can A) take advantage of the depressed market and use the opportunity to find a great deal on an undervalued home or B) wait until the market fully recovers in a few years and pay more for the same house while vying against increased competition for said property. Don’t pay more later; call Zephyr today and see what opportunities are available.