Real estate practices have been evolving with the frenzy.
The market used to be lively seven days a week, but that’s gone away. Looking at homes during the week is futile now, because the new listings tend to hit the MLS on Thursday or Friday with NO SHOWINGS UNTIL OPEN HOUSES ON SATURDAY AND SUNDAY!
By Monday, the listing agents shut it down with NO MORE SHOWINGS, NO MORE OFFERS.
It makes you wonder how the market will react to spring break/tax day.
All the NSDCC schools except Carlsbad are taking spring break between April 4-8, which will limit the action on those weekends of April 2-3 and April 9-10. Then income taxes are due the day after Easter, which is on April 17th. The Carlsbad spring break is April 18-22.
Will agents recognize the schedule, and alter their showing plans?
If not, will the lighter traffic cause those open houses attendees to think the market is getting soft?
The end of the frenzy might be forming right before our eyes!
La Jolla schools are off next week.
But for sellers in Rancho Santa Fe, Del Mar, Carmel Valley, Solana Beach, Encinitas/Leucadia and South Carlsbad, they are looking at three weekends in a row that buyers will be distracted.
Open houses are where the frenzy gets fueled. The biggest motivator for buyers is the fear of loss, and when they see 10-20 cars and dozens of people show up in the first 15 minutes of an open house, it makes them step up their game.
I showed four houses in Carlsbad, Encinitas (2), and CV on Sunday in the $1.6-$1.9 range during their open houses, and I was stunned at the lack of attendees. Two already went pending, and I’m sure the others will too. But if you only get 1-2 offers, it’s not a frenzy.
It still hinges on whether the owners of quality homes will sell. If we keep getting the good ones just trickling out, it will end up being a fairly quiet spring.
I had hoped for a surge of decent homes, and now I’m just praying for something/anything to come to market.
The worst that will happen is that we go from frenzy to non-frenzy just because more buyers give up:
While housing prices aren’t showing any signs of leveling off in the near future, one analyst says he expects total sales to drop precipitously in the coming months.
Ian Shepherdson, chief economist and founder of research consulting firm Pantheon Macroeconomics, predicts existing-home sales will tumble 25% between February and the end of summer. In real numbers, that brings the annual pace from 6.02 million to 4.5 million.
“The housing market is in the early stages of a substantial downshift in activity, which will trigger a steep decline in the rate of increase of home prices, starting perhaps as soon as the spring,” Shepherdson wrote in a note.
The prediction is based upon data from the Mortgage Bankers Association that shows an 8% decline in loan applications. That comes as the average monthly mortgage payment has increased by over $400 per month, Shepherdson calculates. And it could be a canary for the housing industry.
Should the market slow down, he notes, many potential sellers could opt not to list, in an effort to not “be the last person trying to sell into a falling market.” That would hurt existing market supply issues even more.
https://fortune.com/2022/03/22/housing-boom-slowdown-home-sales-drop-25-percent/
Here in Boise, Jim, the market slowed down in November, December and January, like everyone was taking a breather.
In a convo with an agent who’s selling a friend’s house: sales down 5% in those months. But in the last 4 weeks, sellers are seeing 3 to 5 multiple offers when their houses hit the market. He said it’s like spring, 2020 all over again.
Rates here (from my credit union/banks higher):
15-year fixed purchase 3.75%
15-year fixed refinance 3.75
30-year fixed purchase 4.50%
30-year fixed refinance 4.50
Too soon to turn any trend. We need patience to detect an inflection.
My 20y @2.70% is looking good.
I’ll give it a few weeks.
The perception of a slow down may become a reality. Is that what you are saying Jim?
Yes and buyers are looking for any reason to wait at this point. Especially those who have offered $200,000 – $300,000 over list and lost a bidding war or two!
Those who are pondering where this is going, and where it will end up, should consider that the most motivated buyers are winning today.
Those who are more rational/logical are losing – will they become crazier and pay these new prices later? If they weren’t willing to pay them today, it’s a stretch to think that they will pay them later when rates are higher.