Let’s take a look at the covid history of one of our frenzy measuring sticks:
NSDCC Sales-Price-to-List-Price Ratio:
| Month |
# of Sales |
Median List Price |
Median Sales Price |
SP:LP Ratio |
| March 2020 |
206 |
$1,492,500 |
$1,445,000 |
96.8% |
| Apr |
156 |
$1,424,499 |
$1,390,000 |
97.6% |
| May |
143 |
$1,399,900 |
$1,395,000 |
99.6% |
| Jun |
274 |
$1,362,500 |
$1,363,700 |
100% |
| Jul |
351 |
$1,450,000 |
$1,423,350 |
98.2% |
| Aug |
350 |
$1,450,000 |
$1,419,812 |
97.9% |
| Sep |
360 |
$1,500,000 |
$1,498,750 |
99.9% |
| Oct |
382 |
$1,696,500 |
$1,674,100 |
98.7% |
| Nov |
305 |
$1,599,000 |
$1,599,900 |
100% |
| Dec |
290 |
$1,633,500 |
$1,624,391 |
99.4% |
| Jan |
187 |
$1,716,690 |
$1,725,000 |
100.5% |
| Feb |
224 |
$1,719,500 |
$1,758,000 |
102.2% |
| March 2021 |
252 |
$1,800,000 |
$1,825,000 |
101.4% |
| Apr |
359 |
$1,799,900 |
$1,825,829 |
101.4% |
| May |
300 |
$1,900,000 |
$1,979,500 |
104.2% |
| Jun |
357 |
$1,900,000 |
$1,960,000 |
103.2% |
| Jul |
312 |
$1,792,500 |
$1,852,500 |
103.3% |
| Aug |
268 |
$1,897,000 |
$1,950,000 |
102.8% |
| Sep |
283 |
$1,899,000 |
$2,000,000 |
105.3% |
| Oct |
251 |
$1,899,000 |
$1,899,000 |
100% |
| Nov |
200 |
$1,998,500 |
$2,100,000 |
105.1% |
| Dec |
183 |
$1,995,000 |
$2,165,000 |
108.5% |
| Jan |
140 |
$2,234,944 |
$2,240,000 |
100.2% |
| Feb |
158 |
$2,149,500 |
$2,386,500 |
111.0% |
| March 2022 |
206 |
$2,425,000 |
$2,625,000 |
108.2% |
The chatter increases with the lower volume, plus there are going to be months when the offerings just aren’t that tasty. But in 2022, when buyers see a home they like, they over bid substantially!
All we have to do is watch the trend over the next few months to know the direction of the market.
The NAR found that 35% of people aged 65 or above bought a 3,000-square-foot, or larger, home in 2020, compared with only 23% in 2017…..some retirees and older generations are UP-sizing their homes.
While inventory in the rest of the country seems to be turning, San Diego has been getting worse – don’t listen to the national talking heads!
https://calculatedrisk.substack.com/p/1st-look-at-local-housing-markets-bc6
For those looking for doom, Ben’s blog is the best in the business:
http://housingbubble.blog/
From KFMB San Diego in California. “Skyrocketing home prices and lack of inventory have put home buyers in the hot seat and caused many to question when they should buy. The deputy chief economist for the California Association of Realtors, Oscar Wei expects prices to rise more slowly which will prevent the bubble from popping. ‘We do not see the quote unquote bubble bursting because we will see some softening in price,’ said Wei.”
The Dawghaus is a 1961 upscale suburban rambling California ranch that looks like it was built by the same people that built JtRs Home and Car Wash.
2700sf was huge for those days. Homestead size has creeped up since 1890 when it was first tracked. Sadly the last 30 years has seen massive wastes of interior space. The “impressive” two story oval foyer does nothing for livability. IMO a 3000sf these days is less efficient than the 2200sf of yore.
Totally agree – and car wash not included in the square footage either!
Jeff Tucker, senior economist at Zillow, forecasts home values will increase another 17.8% over the next year. Annual home value growth is likely to continue accelerating through the spring, peaking at 22% in May, before gradually slowing through February 2023, Mr. Tucker said.
Ed Pinto, director of the AEI Housing Center, said “2022 and 2023 present a great opportunity to sell, especially if you’re looking to become a renter or move to an area where you can get more home for the money. ”
Mr. Pinto expects home values to continue to appreciate year-over-year at 17% or higher in 2022. He projects 10% to 12% year-over-year home price growth in December 2023.
Lawrence Yun, chief economist at the National Association of Realtors, predicts home values will increase another 5% over the next year. Annual home value growth is likely to continue accelerating through the spring, peaking at 15% in a month or two, before gradually slowing through the remainder of the year, he said.
Options for those who do need to move fast
Jeff Fishman, a financial adviser in Los Angeles, said there is a mood of urgency to sell among some of his local clients hoping to downsize and relocate to less-expensive places such as Nashville, Tenn.
“Take some chips off of the table before rates rise higher,” he said.
Amy Schinco, a real-estate agent in Omaha, Neb., said more sellers are rushing to get their homes on the market and are requesting rent-backs, where they stay in their home for a designated time after the sale. They are doing so to lock in what they believe will be “top dollar” for their home before rates rise further and buy themselves time to find their next home when more inventory comes on to the market, she said.
Other sellers are taking a more cautious approach.
Barbara Fay, 80, initially planned to list her roughly 700-square-foot vacation cottage in Wells, Maine, this spring as she is fearful rising rates will hurt buyer demand. Her daughter Cheryl Costa, 57, a financial planner in Framingham, Mass., persuaded her to wait as many recent buyers in the community have been paying in cash.
Ms. Fay is still concerned she may miss the chance to get the most for her home and is keeping a close eye on how fast other cottages sell and what price they sell for. She’s regularly keeping tabs on mortgage rates.
“If mortgage rates hit 7%, I plan to list,” she said.