October 2022 Market Update
Inventory is lower now than it has been all year with only 85 new single-family homes listed in September. Additionally, months of inventory–the metric that helps us understand how much inventory there is compared to demand–also dropped between August and September. Since its all-time low in December, months of inventory had been steadily rising. While the change in September doesn’t represent a downward trend, it is something to pay attention to.
While inventory is down, competition is also down and, as we’ve stated in the last few updates, buyers have gained back some leverage in negotiations. We see this reflected in the statistics from September very clearly. For example, the number of homes falling out of escrow and going back on the market increased by 32% compared to September of last year. Additionally, homes are on the market for longer than they previously were, 39% longer than the average a year ago. And, we have seen an increase in price reductions by 68% compared to this time last year! These three metrics tell a very important story: buyers are being a bit more choosy than they were a few months ago.
What does this mean about the health of the market? Well, we are still seeing strong results. 87% of new homes listed sold in the month of September, the third strongest month we’ve seen all year (96% of homes sold in August and 87.2% sold in February). Additionally, sellers may be reducing the prices of their homes more, but they are still selling their homes for record prices. The median sales price year-to-date for the month of September (for single-family homes) was up 16% from the same time last year, at $2,200,000.
So, what does this mean for you and your real estate goals? Well, we still believe that now is both a good time to sell and buy real estate. That advice isn’t necessarily one-size-fits-all, we wouldn’t really be neutral advisors if we claimed it was! However, for some, capitalizing on the strong sales prices of homes now may make sense. For others, buying a home now, instead of continuing to pay rent, may make sense in the long run with strategic considerations about how to navigate the challenging mortgage environment. And for some, life circumstances may just mandate a change. Whatever your reasons for considering a change, whether buying or selling, the market we are in today isn’t like the market we were in even a few months ago. At Zia Group we are committed to being your neutral advisors to determine the best next steps for you and your family. Call your Zia Group realtor partner today to discuss your needs, your options, or even your questions. We are here to help.
South Santa Barbara County Single Family Homes for October 2022
Including annual change | See definition of terms