This report is generated around the 20th of each month once the previous months numbers have been posted. What we see here is a report generated for the Tri-County Housing Market which includes Sacramento, El Dorado and Placer Counties through December 2021. So we are always looking a month behind. Our statistics are derived from the Metrolist This is the Multiple Listing Service provider for all real estate brokerages in the Tri-County region. If you have questions or wish to know a more specific account of your properties value and the timing of either selling or buying we are always happy to jump on a Zoom or meet with you at your property to evaluate and discuss a strategy. We can be reached via cell/text 707.580.3499 or email us at concierge@elitepartnersrealestate.com
The beginning of the end… As we enter the New Year we reflect back on December 2021 housing statistics. The landscape in changing in many ways. While many will look at the lower housing numbers as a seasonal lull. We can see some signs that the crazy sellers market might be coming to an end. In December of 2021 we sold 1,969 homes compared to 2,335 homes a year ago. This represents a decline of -16.4% in sales. You could argue that this is because of the Holidays and every year we see a lull. But when we dig a bit deeper and look back two years pre-pandemic we see in December of 2019 we sold 1,856 homes. So in December 2021 we had an increase of +6.1% in sales since the pandemic and what most of us would see as a more normal market. There is however still optimism in the housing market frenzy to continue through at least Spring and Summer. When we look at current inventory levels we see December 2021 had only 1,046 homes for sale which is a small –4.9% decrease compared to a year ago but still a solid -54.2% less than December 2019. So our inventory remains extremely low, lower than anytime in the last 10 years which continues to drive the pricing and demand. However Interest rates are climbing.
If interest rates continue to climb and the Federal Reserve has indicated that they will. Rates could climb as much as 3/4 to 1 percent by the end of the year. This would be a tremendous strain on the buyers power and would force home prices to fall by as much as 15%. When interest rates go up, home prices come down. If home prices start to come down, sellers will panic and we should see a flood of homes come to market faster than expected which will cause further depreciation and buyers will have a much wider inventory to choose from. Homes could be sitting on the market for 45 to 90 days instead of a week or two. Our price per square foot continues to climb to a 15 year high of $329,000. This is an +18.3% increase year over year. It’s good to be a homeowner.
Our Days On Market (DOM) is on the rise now at 22 days, or about three weeks for a home to sell. This is up +22.2% from a year ago and certainly slower than our Spring and Summer months in 2020. Our average home prices peaked in June 2020 at $647,000 and has come down to a December 2020 low of $623,000 which is a +13.7 appreciation from a year ago. It remained steady from one month ago.
We do believe we will continue to see a strong Spring and Summer selling season. If you are a homeowner trying to time the market now might be the best time to sell. Selling before interest really go up will ensure you get a higher price and do not end up chasing the market down.
The opinions expressed in this report are those of Don McDonald, Founding partner, and REALTOR with RE/MAX Elite Partners brokered through RE/MAX Gold. They are not in any way intended to express what RE/MAX, RE/MAX Gold or any other agent or brokerage may think. It is my honest analysis backed but some market data. Check back each month around the 25th or so for an update as we continue down this path.
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Mike Martin and The Elite Partners were a great help in finding our first home , he answered all our questions and was honest on what he could and couldn’t do. When we contacted him he got back to us within a few hours which was great , it made the whole process less stressful and fore the most part pretty easy. We love our new home and would happily recommend Mike and the RE/MAX Elite Partners.
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