Well, we knew it was going to be a unique year and it did not disappoint. It was a roller coaster of a year – locally and nationally. Spring was lively, as usual, and continued to be characterized by more buyers than sellers. In June, a significant jump in interest rates cooled buyer activity as they re-evaluated what they could afford. First time home buyers were especially affected by rising rates. The result was lots of shoppers and interest, but fewer offers per property. Reports that rates might drop caused many buyers to wait – but most kept shopping. Interest remained high. This did not initially translate into lower sales prices, but it did split buyer and seller expectations. Buyers hoped for more concessions, most sellers were holding the line on what they wanted for their homes. The result was longer on-market times for some properties, and some continued to be very competitive. (Areas with premium public school s remained the most competitive. More actual negotiations for either prices or concessions became normal, again. Experienced agents got to flex their negotiation skills, newer agents got to learn new tactics.
Meanwhile, through the summer, agents nationally were awaiting instructions on the industry changes created by the NAR settlement re: buyer side commission changes. For months, legal instructions were changing weekly as CAR’s teams of lawyers sorted out the rules. Agents were put to the test in their abilities to adjust while continuing to serve their clients. How to price in the new legal environment in a market still driven by competition was an interesting exercise in the East Bay, where price-to-entice has been the norm for over 20 years. Marin and the outer parts of Contra Costa County retained a more traditional pricing strategy – but factoring for how/who would pay buyer side commissions definitely required thought before publishing a price. As we inched towards the fall market, we knew would see further changes as the country watched to see what the election results would be. Real estate markets don’t love the uncertainty of election years, and as we know, this was one for the history books. Buyer activity slowed dramatically, and for the first time in years, we started to see price reductions become a regular event. Sellers who were ready sell dropped prices if they could not get an offer – others pulled homes off the market altogether to wait out the uncertainty.
