Are we in an economic recession? | Bay Area News

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The real estate market in the Bay Area is HOT. So here's some Bay Area real estate small talk. If you're looking to buy or sell a house or condo, call me now for a complimentary consultation! In this episode, I will be touching upon three burning topics in the Bay Area housing market today. Story 1: Beware if you are buying a property with a leased solar system. Story 2: Are we in an economic recession? In Story 3, I try to figure out the logic behind Redfin's 'hot homes' category. Don't forget to like and subscribe to this video to stay in the real estate loop and be better informed every week. You can also jump through the timeline and check out your favourite topic right away. Lets get started.


STORY 1: Beware if you are buying a property with a leased solar system

We've all seen the commercials and heard about Tesla's solar roof. It sounds like a great idea: you get a sleek new look for your house, and it's also environmentally friendly. But what if you want to sell your home?

Well, if your home has solar panels installed by Tesla, it might be hard to transfer the title of those panels over to the buyer of your property. That's because the seller is not able to transfer the lease; he needs to buy out the solar panels before selling the property, making it hard for him or her to do so, and leaving both parties in an awkward situation.

The company states that it's not their fault if this happens, and that it's all in the hands of the purchaser. They say that they have a clear process for transferring lease ownership, but many applicants have found themselves waiting for months without any response from the company.

The Tesla solar roofs are a great way to go green and save money on your electric bill. But the after sales service of Tesla is despicable. Although Tesla claims on their website that 98% of applicants who have applied for a lease transfer were cleared, the truth is somewhere in-between. Experts suggest that it's best to buy out the remaining lease payments before listing your home, or price your home lower to get a buyer. Importantly, if you have a lease, make sure the buyer takes over the lease or you will be stuck. And if you are a buyer and in the market for a new home with a leased solar system, you may want to think twice before signing on the dotted line!

STORY 2: Are we in an economic recession?

Are we in an economic recession? This question isn't an exaggeration because tech stocks plunged in value and many big tech firms froze further hiring. But to really understand the economic situation, we need to look at the mortgage rates and the stock market.

Last week, we saw a refreshing exception to the rule: Mortgage rates moved higher at the fastest pace in decades, but stocks did not follow suit. To understand why this happened, we first need to examine the relationship between stocks and bonds—which isn't as simple as many people assume.

Conventional wisdom holds that stock prices and bond yields correlate with each other. This makes good logical sense from the standpoint of selling one to buy the other. For instance, if you sold bonds to buy stocks, bond yields and stock prices would both move higher together. But what if you don't want to sell bonds? What if you just want to hold them?

While it's true that bond prices have been falling and yields have risen over the past few weeks, they haven't fallen by as much as stocks have risen—and they haven't risen by as much as mortgage rates have gone up! In short: Bonds are still down overall since March 1st when rates started moving higher at such an alarming pace.

When the pandemic hit, it was a golden age for tech companies. People stayed at home, and they spent more time on their computers than ever before. As a result, the tech sector flourished.

Now that people are returning to work, though, and spending less time at home—and because interest rates are rising—the tech sector is suffering deep losses as investors fear that companies boosted by the pandemic are running out of steam.

The reason for this is simple: people see their wages going up with inflation at its highest levels in 40 years, so they don't want to spend as much money on technology or entertainment as they want to save for their retirement or children's college education. They're also worried about the economy's direction—with interest rates rising and inflationary pressures building up, there's concern about whether or not we'll be able to avoid an economic recession.

STORY 3: Redfin's 'hot homes' logic beats me

I've been thinking about the Redfin 'hot homes' criteria and how it relates to my experience as a seller. I currently have a listing in Communications Hill that is not being shown as a hot home, even though I believe it's priced competitively.

The Redfin “Hot Homes” program is intended to give consumers information about homes that are likely to sell quickly, but the criteria used to determine whether a home is a hot home seems pretty vague. My price of my listing is just a little bit higher than the Redfin estimate. However, I figure that when there is 120k-130k difference between the redfin estimate and the listed price, the algorithm considers it a 'hot home'. According to Redfin, they have 500 ranking factors to determine a ranking factor. But they also caution buyers that they should not make a decision regarding the purchase of real estate based on whether a home is, or is not, designated a Hot Home. I would do the same. Redfin estimates are just that: Estimates! So take them with a pinch of salt.


As a realtor in the Bay Area, I've had quite a few conversations about people moving to San Francisco and getting jobs in start-ups and growing companies. Most people move for new jobs or for grad school or simply to find love or settle down without your partners. But that's not the primary reason why most people move here, it's actually because of the weather. People from colder climates want to be where it is warm, so after college or office, they can flock to the place where they can wear sandals all the year round, and that place is the Bay Area. Want to invest in a piece of real estate here, I am the Jeeves you are looking for. Call me now. And if you are a first-time buyer, watch this video if you want 0% interest downpayment loan.