question:
Should I wait until Spring (or later) to list my San Rafael home for sale?
We want to capture the highest sale price possible and I’ve always heard that Spring is the best time to list a home. Does this advice still hold true today?
This is an excellent question that local homeowners have been asking me with increased frequency. There has always been a seasonality to our local real estate market and Spring has typically been the best time to list a home for sale—at least in the years before the pandemic-fueled housing boom.
Historically, Spring has been a popular time to sell since buyers tend to come out of winter hibernation and hit the market in droves. Improved weather, combined with school schedules and the absence of major holidays (which inhibit most people from moving due to family obligations), generally means a strong buyer pool which can be advantageous to sellers.
That said, the pandemic has thrown a wrench into the traditional seasonality of the market and the bigger factor we see playing into timing the market right now is inventory. The reason why inventory should play a factor into your consideration of when to list your home for sale is simply a matter of economics. When there are too many qualified buyers chasing too few homes available for sale, it means home prices will continue to rise as long as interest rates (or inventory) don’t get too high.
Interest Rates & Buyer Demand
Mortgage rates remain at historic lows and buyers benefit from these low rates since it gives them more buying power and keeps their monthly housing payment lower. The opposite is also true—the higher a buyer’s mortgage interest rate, the higher...
Almost every industry is currently struggling with supply chain disruptions. This also applies to the current U.S. housing market, where buyer demand far exceeds housing supply.
Purchaser demand is very strong right now. The National Association of Realtors (NAR) just released their latest Existing Home Sales Report which reveals that sales surged in January. Existing home sales rose to a seasonally adjusted annual rate of 6.5 million – an increase of 6.7% from the prior month, with sales up in all regions. However, there's one big challenge.
Inventory Is at an All-Time Low
Because purchaser demand is so high, the market is running out of available homes for sale. The above-mentioned report states that the current months' supply of inventory of homes for sale has fallen to 1.6 months. This prompts Lawrence Yun, Chief Economist at NAR, to say:
The inventory of homes on the market remains woefully depleted, and in fact is currently at an all-time low.
Earlier this month, realtor.com released their inventory data for January. It helps confirm this point. Here's a graph comparing inventory levels for January over the last six years:
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The buzz is everywhere, the headlines abound: the housing market is poised to cool. But is it? And what does that mean? What trends or factors point to this? We’ll try to answer these questions, and then take a deep dive into the data.
What do experts mean by a “cooling” real estate market?
Simply put, it means a decline in housing demand, transactions, and ultimately, prices. And it’s certainly fair to predict cooling when the market’s been heating up for so long; real estate is cyclical after all. But it’s important to keep in mind that even the savviest expert wouldn’t place a high bet on any specific set of metrics, especially these days.
Why? We’re dealing with unprecedented circumstances like the pandemic, federal stimulus, work-from-home, and other dynamics that don’t factor in to normal housing market prediction models. In fact, if you look back to the predictions real estate experts made in March or April of 2020, right when Covid happened, you’ll notice that almost nothing that they predicted materialized. With many market dynamics in the Freakanomics category still very much at play, it’s difficult to predict future prices with reliable accuracy.
So, to say things will cool off is ambiguous at best, and anxiety-producing at worst. It’s a loose term to describe a wide range of guesses. Instead, let’s look closer at the numbers, and try to get a sense for what they really tell us.
What would cause this to occur?
It’s true that in San Rafael (and almost everywhere in the US) home prices have been rising for years, and then unexpectedly surged during—of all times—a global pandemic. We know inventory shortages and rock-bottom interest rates, coupled with stimulus programs and newfound work-at-home flexibility, all played a role. But no one predicted...
Here in Marin County, we are so lucky to have incredible organizations that help shape this growing community for the better. One face behind this community service is deserving of the spotlight: Heather Riley, owner and general manager of School of Rock San Rafael, opening in late February.
School of Rock is a performance-based music school that focuses on five key instruments: bass, drums, guitar, keyboards, and vocals. Their main programs combine weekly one-on-one lessons and group band rehearsals rounding out a great music education in a fun and nurturing environment. And let’s not forget that these students put on live shows at real Rock venues throughout the year!
When Heather was pulled in to help get neighboring School of Rock Santa Rosa up and running in 2018 she immediately felt fortunate to be involved. With about 250 School of Rock’s in the U.S. (300 plus globally), it was clear that this project was successfully changing communities and the lives of the kids involved. “They brought me in for my business administrative experience,” Heather said. “I turned down a very safe job, if you like, with Sonoma County to do this as it sounded much more exciting and challenging. And indeed it was! In doing so, I discovered that music was way more important to me than I realized.” Heather knew that she had always loved music, but her experience was heightened by combining the musical element with taking care of people.
“The upshot is that we teach kids to play music, we teach adults to play music, and we teach them to play music with each other,” Heather said. “With that comes a tremendous boost in confidence. And bigger than that, you get this local tribe and community that develops as a school - which has a real impact.”
Right now, Heather is noticing that this kind of community is what people are really craving....
