Well, the turning of the seasons is certainly in the air, as a dry winter seems to be coming to a close, and the Spring to date hasn’t been very rainy yet either. It is a little unusual to be seeing Facebook posts about my coastal friends doing a “river day” in March… but it is what it is.
I purposely postponed this market report because I was eager to see the March statistics before making any generalizations or predictions, and the trends are as expected, but interesting nonetheless.
Even if you aren’t leaning into what’s been happening, it’s a little hard to ignore the Real Estate statistics, when they are making national news. It was reported recently that the national housing market has seen a rise in 11% over the last year. Locally, our jump was more like 25%. That is an incredible gain over the course of one year, so much so, that it makes me want to double and triple fact check, but that’s what the numbers are showing.
There’s a lot that could be said for this. First, I’ll just also mention that reports are attributing this national rise to “urban flight” – and we all know what that means for this beautiful, rural county.
Next, it’s interesting to consider that we may be at the beginning stages of finally seeing an intense overflow from what’s been happening with the markets in the Bay Area, and indeed Southern California as well. For a long time, it’s seemed that the Redwood Curtain has kept the big money out, but that’s just not the case anymore. Wether it’s our gorgeous coastline, lack of extreme fire danger, or “reasonable” real estate prices, we may never know, but the fact is, many people are moving here, and they’re bringing their cash.
Historically, Humboldt’s Winter Market has been slower, and as a result, typically yields an even stronger seller’s market, offering higher selling prices than any other season here. Many Humboldt folks think Summer is the time to sell here because of the weather, but the stats show you’ll probably get a little more money out of a winter sale. This held true through the winter of 2020-2021.
Encouragingly, we are seeing a significant increase listings, but we’re still not anywhere near what the pre-covid numbers were. The volume of new listings increased from $53 to $84 million just in the last month, so I’m excited to start seeing more and more properties come on the market. This indicates that property values may plateau for awhile, giving buyers a more purchase options and other properties to turn to when their offers are not accepted. (But at this point, let’s be honest – who really knows!? We are in unknown territory right now and anything might happen!)
We’re seeing a backlog of buyers at this point, and the truth is, with some rising interest rates, buyers are getting a little antsy. Some buyers are getting priced out entirely and have to give up, while others are paying premiums for properties in really good shape. There is so much competition that offers come with released contingencies, shortened inspection and escrow periods, and many, many other competing offers. Buyers are holding space regularly in back up positions, and the time between a property being listed and going pending is typically a week or less. The absorption rate actually has continued to go down, with properties selling in 1.5 months instead of 2 (last Dec).
Looking ahead, I can only say that our market is volatile enough that I won’t be making any big predictions. 3 months ago I indicated that there may be less competition in the housing market from investors looking to buy rentals, and by and large that seems to be true, however the influx of people relocating to the area has more than made up for that factor.
The big unknowns for the next few months are many. What will happen with this year’s predictions of drought, and what does that mean for California’s wildfire season? In the distant future, I can only anticipate that our market will continue to grow dramatically (making ANYTIME an excellent time to buy here.)
I’m basing this long term prediction on things like recent announcements such as Google’s Echo, the new undersea cable set to be finished in 2023 and the likelihood of HSU becoming CA’s 3rd Polytechnic University. It’s only going to take one major tech company looking northward to shift our entire economy locally, so it’s an important and dramatic consideration to keep our eyes on.
In closing, we DO still need more properties on the market! If you can afford to flip a house (despite the rising costs of building materials) or if you’ve been thinking of selling and moving, us Realtors would sure appreciate it…. I’ve got a long list of individuals and families, waiting and wanting and TRYING to buy a home. Humboldt still has good fixer opportunities, and a rash of multi-family properties that could use renovating to help with the current state of our rental market as well. That’s outside the scope of what I do, but I’ve been hearing about how hard it is to find a good rental out there, so the struggle is real, and some even would go so far as to say that Humboldt is in the midst of a housing crisis. I’m not going to go that far, but do enjoy helping people find or change homes.
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