Updated: Feb 8
I am regularly asked what I think the local real estate market will be like in 2022 and I smile and share that my crystal ball cracked in 2020 and I haven't been able to find a replacement. Yet, If I have to make an educated, experienced 'guess' I would suggest the demand for homes will still be greater than the available inventory, especially for single family homes, in the suburbs. Being a seller in the East Bay right now is the single best opportunity you may ever have, possibly in your lifetime. I think Contra Costa County is going to have a banner year. If I was thinking about selling in the next 6 to 12 months I wouldn't hesitate to put my house on the market. In fact, my husband and I are considering downsizing in 2022, now that we are empty-nesters and not needing as much square footage.
With the continuing pandemic and the gradual hike in interest rates, now is the time to put a home on the market. I believe much of the demand continues to come from buyers who started to look for a home in 2021 and weren't successful. Most likely, they found one or more, wrote offers and lost to the competition. Multiple bid situations and closing hundreds of thousands of dollars over list price has been very common. The exodus from urban to suburban continues with buyers wanting additional space for home offices, home gyms, more outdoor space and ADU's are on the rise.
In my experience, years ago the phone really started ringing right after the Super Bowl. People seemed to think Winter wasn't the best time to put their home on the market. Historically, most homes hit the market in April-May and close in May-June.. Covid has changed that, and seasonality has been thrown out the window. I have a number of homes that are hitting the market "For Sale" in January and buyers who are ready to pounce.
Interest rates will be going up in 2022, it's just a matter of how much and when the Fed begins hiking rates. And, remember the Fed rate hikes are not perfectly aligned with mortgage rates and a buyer's credit score plays a huge part in the rate they are able to get. I predict rising IRs will partially add to buyers' sense of urgency.
Waiting until the second half of 2022 to sell, could slow down demand and make it harder to sell your home. Even with these predictions there is still uncertainty around the pandemic and how it will impact our housing market and the general economy. I will let you know when I find a new crystal ball.