The frenzy has been making headlines for so long that potential sellers are much more optimistic now. The 2022 Frenzy could look a lot different (i.e., list prices that start too high with sellers expecting even more). Bold added:
Realtor.com’s survey of 2,583 consumers, which was conducted online by HarrisX in September-October 2021, found that:
The majority of prospective sellers plan to list before the end of the year or in early 2022.
Among homeowners who indicated they will enter the market in the next year, 65% expect to within six months, including 19% who have already listed their home.
Compared to the spring (76%), more of today’s prospective sellers (93%) have already taken steps toward listing their home, including working with an agent (28%).
More than one-third of prospective sellers, at 36% each, have researched the value of their home and others in their neighborhood, as well as started making repairs or decluttering.
Consumers’ top reasons for selling reflect the rising influence of more time spent at home during COVID.
Compared to the spring (15%), nearly two-times as many prospective sellers (33%) have realized they want different home features after spending more time at home.
With more sellers having children at home this winter (65%) than in the spring (43%), family considerations are a top reason behind homeowner decisions to enter the market: 37% of prospective sellers say their home no longer meets their family’s needs and 32% want to move closer to friends and family.
The rise in remote work is also a key driver this winter: 23% of sellers are looking for a home office and 19% no longer need to live near their workplace, up from 6% in March.
Sellers have greater expectations of the current market this winter than in the spring.
Over one-third of today’s prospective sellers are eager to take advantage of the current market and think they can make a profit (35%), up from the spring (24%).
When asked how the current market impacts the terms they will ask for, top responses included asking for above what they think their home is currently worth (42%) and asking for a quick close (29%).
Compared to the spring, more of today’s prospective sellers anticipate that buyers will compete in bidding wars, offer above asking, forgo contingencies like inspections and appraisals and more.
Today’s prospective sellers plan to list in relatively affordable price ranges and are potentially more willing to compromise if their expectations aren’t met.
Sellers with homes at the core of the market ($351,000-$750,000) remained the same over March (29%). However, more sellers plan to list in the $500,001-$750,000 price range, which overlaps with recent median listing prices in increasingly popular first-time buyer cities like Riverside, Calif. ($540,000), Austin ($546,000) and Denver ($600,000).
More than three-quarters (77%) of prospective sellers would be willing to accept a lower offer to close quickly versus just over half in March (54%).
Compared to Spring sellers, a higher number of today’s prospective sellers plan to take alternative routes like moving in with family (19%), as well as temporarily renting their home back from the buyer (29%).
“The right time to sell your home is a deeply personal decision that has to be right for you and your family. For homeowners who do feel ready to sell, getting pricing right from the start is key to a fast and successful home sale in any market – take the goldilocks approach,” said Lexie Holbert, Home & Living Expert at Realtor.com.
The state has a new rule that any home that is within the Very High Fire Hazard zone must be inspected for compliance when selling. Each fire district has developed their own way to handle the requests, and Carlsbad charges $149 to visit the property and issue their report on the same day.
Here’s how our first inspection went:
Once the report showed some issues, it’s negotiation time because nothing in the contract dictates who is responsible – and the city doesn’t require compliance or does any reinspections.
Donna received the report promptly, and called me and asked what she should do.
But I had already handled it with the buyer’s agent.
I traded the responsibility for the fire hazards for the fridge!
For those who are thinking of selling next year and plan to do some improvements, don’t wait to begin.
In fact, start today!
Yesterday, I contacted three different flooring contractors, and all were booked into December. Our GC is currently booked for two months, our pool-repair guy has work scheduled for the next FIVE MONTHS, and our plumber gave up and suggested that we find someone else.
If you want us to provide an initial consultation and give opinions of what repairs/improvements would be smart to complete prior to selling, feel free to contact us – now. We can call in favors if needed – the pool guy got started within two weeks!
It made me wonder how many homeowners were in the hunt for a new house over the last 1-2 years, and have since given up on moving and decided to remodel instead.
No matter how small the percentage, it means the demand for homes for sale will be increasingly more dependent upon the out-of-towners who don’t have a house here yet. Their desperation level is higher than our current homeowners here who are comparing to what they already own……and who are finding it more difficult every day to justify a move.
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More slides from the C.A.R. forecast:
They are forecasting a 5.2% YoY drop in sales in 2022, after we will likely set the all-time record for sales here in 2021. They are probably considering the slowdown in pending sales:
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They also showed how 70% of the business is done by 30% of the realtors….and the rest of the agents are barely in business with less than two sales per year:
Looking at the monthly selling trends, average days on market, and a price to sale amount ratios over the last years……these are the best months to sell a home across the U.S.
While we’re talking about the median sales price of detached-homes in San Diego County, let’s review the last ten years. There usually is some dropoff towards the end of the year:
The last frenzy in 2013 saw the median sales price increase 26% between January and September.
The Greatest Frenzy of All-Time started with closings in May, 2020 that had a median sales price of $660,000. It peaked in June/July at $875,000, which is a 33% increase and lasted five more months than in 2013. I’m happy with it, the fun was great while it lasted, and now here we are.
Well, at least until 2022.
There was some hesitancy in the market at the end of 2013, but it took off again in 2014.
Look at the difference though (the graph is interactive).
The increase was only +7% between September, 2013 and June, 2014 before it decelerated again – and the median sales price in November was back to where it was in the previous September!
Sellers should appreciate the big boost we’ve had, and the uncertainty of the future. Don’t attempt to time the market for max return – it’s great where it is today.
School is back in session and the holidays are right around the corner – it’s the time of year that potential home sellers start looking forward to the next selling season, instead of moving in September/October.
Are you thinking of waiting until 2022? Here are my reasons for selling now, instead of later:
1. The Shine Is Off The Frenzy. Those who are pulling back on their enthusiasm:
JBREC – Two of three buyer categories are down slightly (above chart).
CoreLogic – they only predicted a gain of +9.1% in San Diego pricing over next 12 months, which is way less than the +23.7% since last July. Don’t be surprised if +9% becomes the new +3% of predictions – it’s a lot higher than the previous safe bets without being double-digit.
Zillow Offers – backtracking 5% on price commitments made 2-3 weeks ago.
Navy Fed – suspended the issuing of home-equity loans ‘temporarily’.
Refi appraisals – heard of several appraisals coming in low as market softness creeps into their minds.
2. Interest rates – They have nowhere to go but up, and it’s just a matter of when. Once they start, home buyers will want something in return from sellers.
3. Boomer liquidations – There probably won’t be a mass exodus, but all you need is 2-3 on your street.
4. Fewer Fix-Ups – The current inventory is so thin, sellers are getting away with murder now. If there was an index that measured how close sellers got to selling ‘as-is’, we’d be setting records today.
5. Safe – You know what you can get today, and let’s admit – it’s a lot higher than it used to be. Cashing out now instead of risking any of the above getting worse in 2022 is the safe bet. How much are you hoping to hold out for next year? Another 2% or 3%?
When is the best time to sell? When everyone else isn’t!
With the rollout of vaccines against COVID-19, 70% of homeowners in a recent Zillow survey say they would feel mostly or completely comfortable moving to a new home when vaccines are widely distributed — and 78% of homeowners who say widespread vaccine distribution would impact their decision to move say such distribution would makes them more likely to move.
“We expect that the vaccine rollout will likely boost inventory, as sellers become increasingly willing to move despite COVID-19 — resulting in greater numbers of new listings beginning this spring,” says Chris Glynn, principal economist at Zillow. “That injection of inventory could give buyers more options and breathing room in a competitive market. The vaccine, however, will also likely add to already-strong demand, given that most sellers will become buyers as they trade in for a home that better suits their new needs.”
Zillow research shows that 63% of sellers are also buyers. And, as buyers, they have specific reasons for selling. A recent Zillow survey shows that homeowners who are thinking of selling in the next three years have a variety of reasons for doing so.
Additionally, 26% want to live closer to family, 24% wanted out from being responsible for yard work, 14% say their family or household is getting larger and 13% say they can no longer afford their home.
Nearly 40% of homeowners who are considering selling within three years (39%) say they think they’ll get a better price if they wait. They’re not necessarily wrong — although waiting comes with tradeoffs, according to Zillow economist Jeff Tucker.
“Potential sellers are likely correct that home prices have yet to reach their peak,’’ Tucker said, “but in the long run prices tend to rise, so there’s no clear ‘right time’ to sell.”
The catch, he said, is that waiting to sell may raise the cost of trading up to their next home if mortgage interest rates rise.
The real estate market is red-hot, prices are higher than ever and buyers are begging for inventory!
Many homeowners want to take advantage of this opportunity but are worried where they’ll go next. It’s a tough market to be a buyer, but this shouldn’t discourage you from selling your home for the highest price ever – AND we can help! Here are a few solutions:
1. Longer escrow. Gives you time to secure your next home.
2. Rent back. In the past six months, we have arranged rentbacks of 3-6 months for our sellers!
3. Sell your home contingent upon buying. We can lock your home’s buyer and price, and then go shopping!
4. Move in with relatives for a bit. Nothing like some quality family time!
5. Buy your next home first – using a Compass bridge loan. Go for maximum convenience!
6. Find a short term rental in the area. Spending the summer in a beach house doesn’t sound that bad.
Don’t miss out on the GREATEST REAL ESTATE FRENZY OF ALL TIME!
There are a few Zillow issues to unpack here, so let’s start with them saying they are willing to buy your house for the amount of the zestimate – which is fine, if you don’t care about cashing in on the actual value.
In their press release, the boss claims that the zestimate’s nationwide median error rate for on-market homes of 1.9% which sounds simple enough – for years they have been adjusting their zestimate to the list price once a home goes on the market.
But once my new listing went on the market, they didn’t adjust the zestimate upward.
Would you sell your house for $1,336,035, when Jim the Realtor says it worth $1,599,000?
Factor in that Zillow charges more than I do, and it would mean that hiring me to sell your house would net you about $300,000 more – and that’s if we sell for the list price (it might go higher).
The big difference?
I don’t spend $100 million per year in advertising – they will reach people that I don’t reach.
