The current banking crisis may have some positive effects for the California real estate market. After hitting a high of 7.08 percent in November, mortgage rates have been declining, going from 6.73 percent before the bank crash to approximately 6.42 percent currently.
After the Silicon Valley Bank breakdown, many investors moved their money to U.S. Treasury bonds, which helped produce the lower mortage rates. Moreover, the Federal Reserve’s recently announced it would raise the benchmark rate by only a quarter percent.
While this bodes well for the housing market, many analysts see a fairly lackluster year for sales as many buyers are still priced out of the market.