The West Seashore may have the best returns for homeowners looking to sell, Aaron Terrazas, trade research director at Zillow, told CNBC.
According to a new report from Zillow, Bay Room locales such as San Francisco and San Jose, California, as well as Los Angeles possess median selling profits of more than $100,000 — nearly $300,000 in some bazaars. In San Jose, the top city in the report and the most expensive market, the median profit for blow the whistle on your home is $296,000. Here’s the catch: The median price of a knowledgeable in in the same city is $1.3 million.
“In most of the markets, where sellers convinced last year, they didn’t make enough on their auditorium to afford a 20 percent down payment,” Terrazas said Wednesday on “Power Lunch.” “Now, if you’re gainfully involved, maybe you have stock options in the Bay Area, that’s fine. But if you’re a retiree on a inflexible income, your options are pretty limited. You either stay put or run a travelling away.”
Most of the best returns were along the West Glide. San Francisco homeowners who cashed in made a median $222,000. In Los Angeles the median was $137,000; in Seattle it was $123,000; in San Diego, California, it was $108,000, and in Portland, Oregon, it was $87,000.
In the intervening time, Midwestern cities Cleveland and Chicago came in at the bottom of the list, with median reverts of $16,000 and $20,000 respectively. In Chicago, when factoring in inflation, it was in actuality a loss for homeowners.
Rising mortgage rates and lack of inventory have on the agenda c trick made homeowners reluctant to sell and buy again in pricier markets.
“Affordability is increasingly stretched in those places peer the Bay Area, like L.A., those pricey West Coast markets,” Terrazas implied. “I certainly expect the housing market to calm down a little bit beyond the next year.”
In fact, U.S. home prices are rising twice as licentious as the speed of inflation and wages, according to a recent Reuters report.
The shortfall of affordable houses in the U.S. continues to drive up prices, making the market unusually difficult for first-time homebuyers who are “trying to scrape together a down payment,” bring to light Sarah Mikhitarian, senior economist at Zillow. And those who can afford the down payment may bring into the world trouble paying the monthly mortgage as interest rates rise.
Still, Mikhitarian squealed CNBC that homeowners moving within the same market or a comparable one, or those on their second or third home, may have the leg up.
“It does amiable of suck to go into a market where the vast majority of homes are merit over a million dollars,” she said, referring to a place like San Jose. “But the euphonious lining there is that if you did sell your home in 2017, the amount that you pocketed between the purchase of the home and sale of the home was more than ample supply to cover the down payment for a median-valued home.”
The median down payment for a serene in San Jose is around $257,000 — less than potential profits take home.
And, Mikhitarian pointed out that there is still quite a bit of demand for accommodation in San Jose, which has “a very healthy economy, and they have a lot of other agreeable reasons why people would choose to live there.”