Weary homebuyers, looking for a break, may have something to look forward to in Pleasanton during 2022.
Buyer behavior has shifted during the second half of 2021 and is likely to continue into next year said Tina Hand, 2021 president of the Bay East Association of Realtors.
"Homebuyers in general are finding less competition when they bid on properties," Hand said. "A lot of buyers still have some fatigue; they've been in the market a long time and they've been outbid a lot."
She explained that historically high sales prices have taken their toll and there are simply fewer buyers in the market. Hand said buyers, "are still waiting for prices to come down more even though we have seen price adjustments."
The number of pending sales in Pleasanton peaked at 87 during April then stabilized during May, June and July. During August, pending sales dropped to 57 and then 54 during September. This trend indicates flagging buyer enthusiasm also reflected in sales prices.
From August to September, the median sales price for a single-family home in Pleasanton dropped from $1.79 million to $1.56 million. This change was only one of the few times during 2021 that sales prices decreased month-to-month.
Hand said buyers are backing off and sellers aren't used to that. Asked how sellers are responding, Hand said, "I think they are a bit surprised that they aren't getting the prices we were seeing even as recently as August and the beginning of September. They haven't quite woken to the fact that the market is shifting."
"Sellers had been getting 15 or 20 multiple bids going $200,000 to $400,000 over the asking price, and that's not happening," she said.
Hand said changes in the overall cost of living are dampening buyer enthusiasm.
"People are starting to see fuel prices increase, food prices increase; I think that's another factor in why people may be backing off a little bit," she added. "We've got inflation going on and I think that scares people. Especially first-time homebuyers are a little skittish and going to wait to see what happens.
While the month-to-month price changes from August to September are surprising, they don't yet point to a larger shift in home sales prices. The median sales price for a home in Pleasanton during 2020 was a little more than $1.25 million. From January through August 2021, the median sales price was more than $1.6 million.
Hand said, "There's talk about a 'housing bubble' but the factors just aren't there; this is not 2008. What happened then is not going to happen in 2021."
Looking ahead, Hand said buyers should be positive, with potentially more options. "More inventory coming on the market helps homebuyers who are moving up, or moving down or first-time homebuyers -- whatever the case may be."
Asked when the 2022 real estate season will begin, Hand predicted, "I'm going to bet we see it begin the very end of December or by the middle of January. With the positive news that the '1031 exchanges' will be around, that will make a difference with both residential and commercial real estate."
Editor's note: David Stark is the chief of public affairs and communications officer for the Bay East Association of Realtors, based in Pleasanton.