Tame. That’s a good way to describe the spring season so far. We are definitely seeing signs of seasonality, but the market isn’t blazing hot either. Historically, the housing market really picks up in March, so let’s talk about that (and touch base on condos). This post is designed to skim quickly or digest slowly.
UPCOMING SPEAKING GIGS:
3/20/25 HomeSmart iCare Realty (private I think)
4/2/25 SAFE Credit Union (details TBA)
4/10/25 Yuba-Sutter Association (details TBA)
4/15/25 Culbertson and Gray (private I think)
4/24/25 KW EDH (private I think)
5/8/25 Private event (details TBA)
5/13/25 PCAR
6/5/25 Auburn Marketing Meeting
9/26/25 PCAR
11/4/25 SAR Main Meeting
Scroll quickly by topic or digest slowly.
1) THE PROBLEM WITH HOA FEES
I know this visual is crazy, but it shows HOA fees have definitively risen in recent years. Look, condos have a few different headwinds right now, but one of the bigger issues is the HOA fee is standing out in a bad way. It’s been tough for buyers to digest lofty fees that diminish affordability. Moreover, we may be seeing a preference issue where buyers are wanting a backyard instead of attached living. This is why we’ve seen more subdued condo volume, and why prices in some condo subdivisions have been dropping.
2) HOUSTON, WE HAVE SPRING LIFTOFF
A spring market is definitely happening. I know it feels like it’s not to some, but we’re seeing more supply, slightly more sales from January, it’s taking less time to sell, and prices ticked up higher. This is all the normal stuff we’ve been expecting, but it’s also still been a softer spring so far. Part of the softer vibe stems from rates starting out higher this year, and some of it is having more listings, but we also want to keep an eye on increasing economic uncertainty and consumer confidence.
And year-over-year stats.
3) MARCH TENDS TO PICK UP MORE
We typically hit more a stride in the housing market in March, so we want to watch for that. The number of new listings historically increases 31% between February and March in the region, and the number of pending contracts increases by 25%. The key today is to understand the norm so we can interpret the existing market based on that. Look, we don’t expect anywhere close to the normal level of listings and sales, but we want to watch for the expected amount of seasonal change. Does that make sense?
4) $2.4 BILLION IN VOLUME SO FAR IN 2025
As of last week, we had $2.4 billion in purchase volume in the wider region. As a side note, if you work in real estate, you may need to expand your coverage area since there aren’t as many buyers today. This is why it’s important to keep an eye on what’s happening in other areas too.
5) SUPPLY IS GROWING, BUT NOT LIKE 2008
In 2023, it was a really tight market when sellers stepped back, but sellers are thawing out much more right now. We are still far below normal levels, but the market is really feeling more active listings since the number of buyers has been subdued. By the way, the number of active listings in 2008 was about 14,000 at this time. Just in case you were thinking today was similar. Keep in mind active listings isn’t just about more sellers. It’s also about properties staying on the market longer.
6) SPRING PRICE BUMP, BUT A MIXED BAG
We’re seeing price metrics tick up early in the year, and we should see that next month also since pending contracts are larger in size and getting into contract at higher levels. Yet, despite an increase for the region as a whole, so many neighborhoods just feel very flat, and it’s possible some could be declining too. The market is a mixed bag right now. Keep in mind some smaller counties could be all over the place with price metrics too since there isn’t much data, so be careful about interpretation from month to month.
7) COMPETITION LEVELS ARE PRETTY NORMAL
Some properties are getting bid up while others are sitting. When we look at the numbers below, competition actually looks pretty normal. This doesn’t mean the market is normal, but the stats in this regard sure are. No matter what, properties are either getting lots of attention quickly or sitting. It’s either multiple offers or crickets. That’s the vibe.
8) FRUSTRATING FOR BUYERS DESPITE HEADLINES
Many headlines are talking about good deals for buyers right now, and I get that in light of the market softening. But the struggle right now is the hottest property for sale is the one that is well-priced and in good condition (upgraded too). So, there can be heavy competition for certain properties in particular, which creates a disconnect between a dull housing narrative and the actual market.
9) THE STORY ISN’T THE SAME FOR EVERY PROPERTY
Here’s a cool way to look at how every property sold compared to its original price. Some got bid up 15% while others sold 25% below their original price. My advice? Be sure to look at the entire market to understand the trend. In other words, don’t judge the forest by just one or two trees. Remember, the story isn’t the same for every single property.
10) GETTING BID UP HAPPENS RIGHT AWAY
If a property is going to go over the asking price, it happens pretty much in the first two weeks – but especially the first week. Then, the longer a property is on the market, the lower it tends to sell from its asking price. Look, so much of this hinges on the credibility of the original price. It’s not like properties are getting bid up 15% over market value. Nope. When a property has a freakish number of offers and goes way over asking, it’s probably due to being priced too low.
11) PENDING CONTRACTS ARE GROWING (BUT LOWER)
We’re seeing spring happen in the pendings too. The hope is the entire year will outpace last year, but so far, it’s been about on par with last year. Do you see that little uptick on the right side of the graph? Yep, that’s spring. And a good way to describe the market is listings are growing faster than pendings.
12) NO LONGER LIGHTNING SPEED
Gone are the days where mostly everything was selling in lightning speed. Today’s trend (blue) has been very consistent with the pre-2020 norm (red). We could get sensational and say properties are taking twice as long to sell today compared to 2021, but that was a freakish year, so we have to back up and ask what the normal trend looks like.
And here’s a cool way to look at days on market by price. The higher the price, the longer it takes to sell. That’s the trend, and it’s something we’ve seen consistently through the years.
13) “FHA IS GOING TO CRASH THE MARKET”
There is so much attention right now on rising mortgage delinquencies among FHA loans. This is not something to sugarcoat, but let’s stay in touch with the reality that FHA was only 11% of the entire market last year locally. So, when we hear that FHA loan problems will crash the entire market, that sounds sensational. Again, I’m not sugarcoating, so save your hate mail. Let’s just be realistic about context.
14) HITTING A SPRING STRIDE
The number of new listings should pick up more significantly in March, and we’re already starting to see more action in recent weeks when looking at the daily trend.
Thanks for being here.
LEAVING COMMENTS: The captcha is not working perfectly. If you open up a new browser, that should solve the issue. It’s been a problem when clicking from my weekly email and trying to comment. My apologies. I hope to have this solved eventually.
Questions: What stands out to you the most above? What are you seeing in the market right now?
If you liked this post, subscribe by email (or RSS). Thanks for being here.
Leave a Reply