1. Low Inventory
Scarcity is far and away the number one reason 2022 will continue to be a seller’s market. Homes are selling before they hit the market, going into escrow weeks after they’re available. Redfin reported 10 Housing Records that were broken in 2021, one of them being the lack of homes for sale. There were just 1.38 million homes available in America in June (down 23% from the previous year). The typical home sold in just 15 days. There were countless stories of homes sold over list price, all-cash offers, and homes sold off-market. Bidding wars became the norm, with 75% seeing multiple potential buyers compete against each other. It may be a dog-eat-dog world out there for buyers, but sellers are enjoying the spoils.
2. Selling prices are at an all-time high.
According to the National Association of Realtors, the median home selling price increased to an all-time high of $362,800 in June 2021 (up 24% over a year). In addition, the affluent are looking for second homes at an all-time high. Redfin also reported that luxury homes sold for 26% more than 2020 (likely thanks to the booming stock market). Second homes are often of the luxury variety - a vacation home offering oasis and subtle opulence. Sellers in desirable locations with beautiful homes and killer views (*cough cough* the South Bay) have an excellent opportunity to sell to second home purchasers.
3. Mortgage Rates are at an all-time low.
Mortgage rates hit their lowest ever - just an average of 2.65% 30-year fixed rate. This fact is favorable for both buyer and seller. With low mortgage rates, the pool of potential increases. For buyers, this opens up opportunities for a new home, but it also saturates the market. For sellers, low mortgage rates are purely a good thing.