One likely reason for the stagnation in median sale prices throughout the East Bay is that inventory levels jumped by a considerable margin in February. We saw a 16.82% increase in the number of active listings compared to January and a 40.17% increase compared to February of last year. This level of inventory was not seen until April/May of last year!
This suggests that people are ready to move, and they’re not letting interest rates play into their decision to sell or stay put! If we continue to see unprecedented increases in inventory like the one we saw last month, prices could start to decrease as inventory sits on the market. However, for now, the inventory is still moving!
Despite the inventory increasing, it’s still moving!
Although we just saw inventory levels skyrocket last month, demand remains strong, with the number of sold listings in the East Bay increasing by 2% on a year-over-year basis, and 35.55% on a month-over-month basis. As we mentioned in the prior section, we have to see demand pick up substantially in order for prices to stay where they’re currently at!
The East Bay continues to be a seller’s market
When determining whether a market is a buyers’ market or a sellers’ market, we look to the Months of Supply Inventory (MSI) metric. The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market. Any market that has lower than three months of MSI is considered a seller’s market, whereas markets with more than three months of MSI are considered buyers’ markets.
Despite the drastic increase in supply that we saw last month, the single-family home market remains a strong sellers’ market within the East Bay, with Alameda County having just 1.6 months' worth of supply and Contra Costa County having just 1.8 months of supply. On the flip side, the condo market is not nearly as competitive, with Alameda County having 3.5 months' worth of supply and Contra Costa County having 2.8 months’ worth of supply.
