Are you getting into the holiday spirit? I’m not there yet, but I’m hoping to find my way there. I mean, I did see the Foo Fighters play this week and that was incredible. But it didn’t really catapult me into holiday cheer either. Anyway, I’m open to ideas if you have some. For now here are three things on mind:
1) ‘Tis the season for foreclosure press releases:
In the next week we’re going to start seeing press releases about foreclosures being delayed for the holidays. This is a nice gesture, but the truth is foreclosure is going to be unwrapped as a New Year’s gift instead. Even in Sacramento County we see bank-owned sales spike in the first quarter. Thankfully distressed sales aren’t common these days as there were only six bank-owned sales in the region last month (one quarter of one percent of sales).
2) Is this what a slow housing market feels like?
This is supposed to be the slowest time of the year in real estate and there is no mistaking the market has softened from the spring, but it’s still really competitive. This is exactly what I’m hearing from the real estate community and it’s the story stats are telling. As I unpack numbers, I want to reiterate my advice last week to buckle up for the beginning of next year. I’m telling you, we’re poised to begin 2022 at a really competitive spot – especially if this is what the slowest time of year feels like.
3) Speaking gigs in January:
Here are two events I’m doing next month. I’ll have two or three others also, but I haven’t seen details released yet.
Big 2022 market update at SAR: I’m doing a market talk on January 18th from 9-10:30am. Hope to see you there. Sign up here.
Top producer panel: I’m doing a market update at Granite Bay Country Club on January 12th and here is the most random promo video. I didn’t write this script, but I did play along. Haha.
I hope you’re finding joy during this holiday season.
Thanks for being here.
—–——– BIG MARKET UPDATE FOR THOSE INTERESTED ———––
Skim or digest slowly.
Between November and December we tend to see the housing market hit its slowest point of the year, but it doesn’t really feel like that right now in the trenches. I mean, on one hand we definitely have less demand as some buyers are sitting out because the holidays are upon us. But for buyers playing the market it’s ultra-competitive. There is a smidgen of hope as buyers have slightly more power than the spring, but the market is still more elevated than usual for the time of year.
A quick recap:
Some visuals eh…
SEASONAL MARKET ON STEROIDS:
That’s a really good way to describe the market right now. Statistics are showing clear seasonality, but the market is still way more competitive than it normally is at this time of year.
YEAR OVER YEAR:
Year over year stats are important to digest, but don’t forget to look at month to month stats to understand what the market is doing right now.
MONTH TO MONTH:
Stats from October to November were somewhat flat. I mean, technically prices rose, but I wouldn’t make too much of that. At this time of year stats bounce around all over the place. In other words, when the market starts to slow at the beginning of summer we don’t always see a dramatic decline each month. Sometimes the numbers are up and sometimes they’re down month to month. Ultimately what I’m trying to say is don’t write home and talk about the market showing a price increase from October to November.
WHAT THE…. STILL SELLING ABOVE THE LIST PRICE:
Two years ago properties on average sold about three percent below their original list price at this time of year because that’s what tends to happen during a slower fall season. But last month properties on average sold at 100.27% of their original list price. This might sound incredibly minor to say homes sold 0.27% above their asking price on average, but compared to a normal trend, homes really should be selling a few percent below their list price. In short, this is bananas.
On average properties sold $1,671 above their original list price. Remember, this only represents the average. It does not perfectly describe every escrow because clearly some sold way above that amount, some sold at list price, and some sold below. The bigger issue is if we had a normal market properties on average should be selling about $15,000 or so below the asking price.
Being that only 13% of sales sold below the list price last month, that’s a sign the market is not overpriced as a whole. It is true that sellers who list too high are going to have properties that sit (seriously). It’s just stats show this is not what every seller is doing.
HOW IS THE MARKET DISTRIBUTED?
I’m glad you asked. This is a cool visual I’ve been making for a few months. It shows how prices are distributed throughout the market. Do you dig this one?
STRONG SALES VOLUME:
There is no mistaking prices have risen and the housing market is becoming more difficult to afford, but stats still show buyers are getting it done. This is not to gloss over the reality of some buyers being priced out of the market. I’m just saying statistically sales are happening at strong levels. Here is what sales volume looks like right now in various counties.
As if anyone really wanted more…
Thanks for being here.
SHARING POLICY: I welcome you to share some of these images on your social channels or in a newsletter. In case it helps, here are 6 ways to share my content (not copy verbatim). Thanks.
Questions: What are you seeing out there in the market?