Interest rates continue to take center stage. Rates determine affordability along with prices. How are the rising rates affecting the market?

The Record report of the Housing Barometer says applications have been mostly declining since mid-March as mortgage rates have moved sharply higher from where they were a year ago. The National Association of Realtors expect a 22% drop in the number of sales this year! The average rate on a 30-year mortgage rose to 5.97% last week, the highest since 2009, according to mortgage buyer Freddie Mac. A year ago the 30-year rate stood at 3.25%.

Locally, prices continue to increase as you can see from the chart below. Properties sold at 1% above the original list price. Inventories increased at 1.4 months’ supply, an increase of 81%!

Tracy had the highest price increase, year over year, of 24%, and a median price of $915,000, more than double Stockton’s median price of $435,000!

Message: It is still a good time to buy because there is more inventory and less competition, due to the increase in rates which are pricing some buyers out of the market. Move up buyers have acquired a lot of equity, allowing them to purchase higher priced homes with more amenities.

HOME SALE FAST FACTS:  May 2022 versus May 2021.

SAN JOAQUIN COUNTY
MEDIAN SALES PRICE: $560,000 (+12%)
FOVR SALE: 683 Homes (+81%)
HOMES SOLD & CLOSED: 486 (-17%)
INVENTORY: 1.4 MO.

STOCKTON
MEDIAN SALES PRICE: $435,000 (+9%)
FOR SALE: 272 Homes (+44%)
HOMES SOLD & CLOSED: 230 (-8%)
INVENTORY: 1.2 MO.

LODI AREA
MEDIAN SALES PRICE: $570,000 (+11%)
FOR SALE: 97 Homes (+62%)
HOMES SOLD & CLOSED: 65 (-29%)
INVENTORY: 1 MO.

MANTECA-LATHROP AREA
MEDIAN SALES PRICE: $660,000 (+17%)
FOR SALE: 193 Homes (+188%)
HOMES SOLD & CLOSED: 147 (+16%)
INVENTORY: 1.7 MO.