Spring Real Estate: Local market remains solid despite distractions elsewhere

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Pleasanton is still a great place to live; it’s the rest of the world that is worrying homebuyers and sellers.

“There’s recession fears, the possibility of interest rates going up, and of course there is insecurity in just the state of world affairs and that does have an effect at the local level,” said Steve Medeiros, 2023 president of the Bay East Association of Realtors. “It affects people in a negative way. You hear buyers say, ‘I’m worried about the world and that’s why I don’t want to buy’ and it unsettles people.”

So far this year, homes are taking longer to sell. A home was on the market an average of seven days during March 2022. This March, it took an average of 23 days for a home to sell.

The number of homes sold is off, as well. There were 53 single-family detached homes sold during March 2022, compared with 31 sold during March 2023.

A major factor keeping buyers on the fence and homes on the market longer is significantly higher interest rates. According to the California Association of Realtors, during March 2022, a buyer could secure a 30-year fixed-rate mortgage with an interest rate of approximately 3.75%. During March 2023, the interest rate for the same type of mortgage was approximately 6.3%.

Higher rates mean less buying power. And while prices have dropped during the last year, they are still making buyers pause. The median sales price for a single-family detached home in Pleasanton during March 2022 was more than $2 million. By February 2023, prices had dropped to $1.4 million then rebounded to $1.8 million during March 2023.

On the other side of the transaction, sellers are also concerned about their options and if the grass is actually greener somewhere else. “People in general are staying in their homes a lot longer than they used to. It used to be seven years; now it’s 11 or 12,” Medeiros said. “A lot of that has to do with the environment you live in. I have many clients that can’t wait to get out of this state because of the over-regulation and the burden of taxes. But they don’t do it because they love it here. It’s a catch-22.”

Despite both buyer and seller concerns, Medeiros is bullish about Pleasanton real estate.

“The upside is that the market is good, and the market still works. When people put houses on the market, they sell,” Medeiros said. “And we are in the most amazing part of the world that everybody wants to be a part of. Those are the upsides. But yes, there’s distractions that weren’t here during the last five years.”

Medeiros cited Pleasanton and other Tri-Valley community characteristics that transcend economic cycles as part of its desirability.

“Quite frankly, the Tri-Valley has a very good reputation. It’s the place where people these days want to migrate to,” he said. “Part of that is the job base has broadened and you see a lot of high-tech jobs here. It’s got the old-town feel that some towns in the Bay Area used to have. People now seem to want to migrate to Pleasanton, Livermore and Dublin to get that feel that they had in their former homes.”

Medeiros agreed that within the nervousness about real estate in general that there may be some exceptions in the Tri-Valley — and that of all the things people are worried about in the world, living in the Tri-Valley isn’t one of them.

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