Supply and demand has a way of finding level water. Home buyers are retreating, but not vanquishing. Interest rates are rising, and buyers are feeling inflation.

Silicon valley is Cooling Fast

In some areas, a new 10% year-over-year uptick in the housing supply following a 43% decrease in inventory at the end of 2021, suddenly an uptick in housing inventory is beginning to result in lower list prices.

Both urban and rural cities in the north have undergone a cooling as has Oakland which is number three on the list of cooling cities while San Francisco comes in at number 10.

Boise, Denver and Tacoma (along with other cities like San Diego and Austin) saw real increases in population and home values in the last few years. Homes in these areas are no longer receiving the bidding wars of last spring.

Good News?

People who can afford to buy right now could get something for $100,000 or $200,000 less than a few months ago.

In the Santa Barbara MLS there were nine price reductions averaging about an 8% decrease. On a $1.5MM home that's a $120K price drop. The monthly nut for a buyer with a loan may remain high with interest rates hovering around 6%, but it may be possible to refinance in a few years and in the face of 9% inflation, using leverage, while risky, can pay off.