Market Reports
Dec 31,2021
2021 was a record-breaking year for the housing market! Prices skyrocketed, multiple offers became common place, homes sold at or over their asking price, mortgage rates hit record lows, and the pandemic turned traditional buying and selling tactics on their heads.
Will it be more of the same in 2022, or can consumers expect slightly more manageable conditions?
No one has a crystal ball and various experts predict slightly different scenarios, but the one common thread all experts can agree upon is......"Prices will continue to go up in 2022."
What the Experts Say
Below is a compilation of various expert`s predictions for 2022:
- Expect a whirlwind 2022 for the housing market due to low inventory as buyers compete for a limited number of homes.
- The Wall Street Journal states, "Home sales are headed for the best year since 2006."
- If you are halfway interested in a home on the market Buyers will need to have their finger on the trigger ready to go because there will be 50 people looking at the same 3 houses as everybody else.
- It`s suggested that Buyers have proof of funds or their lender`s pre-qualification letter in hand so they will be able to act swiftly if they find a house they want to buy.
- The ability to work from home will continue to be a motivational factor throughout 2022. Buyers will continue to leave congested cities & relocate to the suburbs in search of larger homes so they can work remotely.
- After a year of home prices rising a blistering 18% or more in 2021, housing prices are expected to continue to rise in 2022 but at a single digit rate ranging from 2.9% - 7% on top of the already highs of 2021.
- Mortgage rates will continue to inch up but predicted to stay under 4% for a 30 year fixed loan by year`s end.
- After being the state with unbounded population growth, for the first time in history, California lost over 367,000 residents. (The largest population decline in the country). Behind California was New York (-352,185) and Illinois (-122,460)
- Los Angles & San Francisco Bay areas both lost population resulting in a loss of a Congressional seat.
- 2022 will continue to see elevated levels of people moving out of California to states with outdoor amenities & lower costs such as Texas, Florida, Arizona & North Carolina all of which outpaced the Nation in number of home sales in 2021.
- Rent prices will continue to rise 7.1% which will motivate renters to become first time buyers instead of renters.
Millennials Bolster the Housing Market
- Since 2019 Millennials have surpassed the Baby Boomers and are now the largest living adult generation in America.
- Millennials (born 1981-1996) previously known for "renting" are now seeking home ownership with Generation Z (already in their early 20`s) close behind.
- Due to this large wave of Millennial buyers, a majority of experts predict we will not see any reduction in home prices for quite awhile.
- For years young Millennials preferred to rent and spend their money on traveling. The Millennials are now older & getting married thus seeking home ownership causing many economists to predict home buying demand is likely to remain strong for years to come.
- CoreLogic states: "Millennials accounted for 67% of first time home purchase mortgage applications & 37% of repeat applications in the first 8 months of 2021 & predict this pattern will continue in 2022.
Inventory is Historically Low Throughout the Entire Coachella Valley!!
** Data taken from MLS deemed accurate but not guaranteed
The November CDAR report (California Desert Association of Realtors) states:
- The December 1, 2021 inventory in the entire Coachella Valley declined to only 742 units which is 59% below last year.
- This historically low inventory is causing prices to remain high throughout the nine cities in the Coachella Valley.
- In December 2016 there were almost 5,000 homes for sale compared to only 742 homes for sale in December 2021. (see chart below)
Inventory
How Did Indian Ridge Fare in 2021?
- 2021 was a fantastic year! 125 Indian Ridge homes sold in 2021 (equates to 2.4 homes sold each week) compared to 98 homes sold in 2020.
- 2021 MLS reported the lowest sold price of $347,000 & the highest sold price of $2,525,000 which was a record high & scheduled to close escrow on January 4th.
- 58 Indian Ridge homes sold over $1,000,000 in 2021.
- The 2021 median price was $950,000 (a 21% increase over 2020 which had a median sold price of $785,000.)
Bottom Line: This increase in price is good for Sellers, but still way below the big city median prices which is good for Buyers as well. It`s a win-win for everyone!
Here`s wishing you & your family a healthy and prosperous 2022!
