Real estate pricing records are broken almost every month. In
Morgan Hill in March, the median resale price of a home was
$769,000 based on the sale of 53 homes.
Real estate pricing records are broken almost every month. In Morgan Hill in March, the median resale price of a home was $769,000 based on the sale of 53 homes. That’s 3.9 percent more than February and 16.5 percent more than March last year.
Countywide, the median home price rose even faster, gaining 4 percent month to month to $733,000 and 17.3 percent more than a year ago.
Other barriers also are being broken. In Gilroy a house in the city’s traditional core is on the market for more than $1 million. To be exact, the four-bedroom, two-bath home at 7590 Princevalle St. has an asking price of $1,198,500.
We wish we were surprised about this continued increase in price, but, sadly, we’re not. Like everyone who watches the Bay Area real estate market, we’ve seen home prices spiral during the dot-com boom, then continue to spiral in the wake of the dot-com bust.
It’s important to remember that the hot Bay Area housing market is a double-edged sword.
For those of us who are fortunate enough to own Bay Area real estate, the continued rise in prices is good news, leading to higher and higher amounts of equity and increased net values of our assets, at least on paper.
For those of us who have not been able to purchase homes, the seemingly unstoppable real estate market places the American dream of home ownership out of reach for many.
Whether you’re a homeowner rooting for the real estate bubble to continue to grow, or a renter hoping it will burst, we all have to wonder: Will it burst, and, if it does, what will serve as the needle that punctures it?
Will it be higher mortgage rates, fueled by increasing national debt?
Will it be continued weak employment, due to outsourcing of jobs to cheaper labor markets like India and China? Will it be the impending retirements of huge numbers of baby boomers eager to cash out their equity, causing a flood of listings?
Lacking a crystal ball, we can’t say when or why the bubble will burst. But we do know this much, lessons learned painfully from stock-market corrections and the dot-com crash: The real estate market can’t continue like this forever.
The continued skyrocketing of home prices is dizzying, it is also a warning sign: Be careful with how you finance your home purchase, with how you’re planning to pay for your retirement or children’s college education, with the timing of a first-time or moving-up home purchase.
Because when the real estate bubble bursts or even deflates just a little, it will hurt some and help others.
As much as possible, plan ahead, spend your housing dollars prudently, and finance carefully so that you and your family are in a position to benefit as much as possible and be hurt as little as possible when the market finally pops.
