2022

Your Real Estate Expert for Berkeley and Beyond

  • Deep Market Knowledge
  • Analytical, Strategic, Creative
  • Honest, Adept, Direct

“Marilyn is exceptional. Her knowledge base, enthusiasm for her job, professional ethics, organization, sensitivity to our aesthetic requirements, loyalty and gentle perseverance set her apart.”

-- Bill and Carol Seidel

Marilyn Garcia, PhD

Marilyn Garcia, PhD Broker Associate, Realtor® CA DRE LICENSE #01355514

The Grubb Company 1656 Shattuck Avenue Berkeley, CA 94709

Direct: (510) 390-5406

THE OUTLOOK: North Berkeley & the Berkeley Hills, Q4 and Annual 2022 results

Last year was the craziest roller coaster I’ve ever seen in our local market. We started 2022 with an intense surge in buyer activity, but that surge was reversed by the summer and through the end of the year, as buyers adjusted to higher interest rates, concerns about the economy, and declines in the stock market. *** NORTH BERKELEY: Looking at 2022 as a whole, the median sold price in North Berkeley was $1,650,000, which is unchanged from the previous year. Average sold price per square foot, at $1046, was up 7% compared to 2021. Properties in North Berkeley sold [...]

THE OUTLOOK: North Berkeley & the Berkeley Hills, Summer 2022 results

The real estate market over the summer was noticeably more subdued than in the first half of the year. Buyers were in an absolute frenzy in the spring, anxious to get into the market before interest rates increased, and as a result, prices went up sharply. Over the summer, the spring spike in prices vanished, as buyers became much more cautious. A number of factors together explain why the summer market slowed. The stock market went down (affecting buyers’ down payment funds), and interest rates went up (affecting affordability). Some buyers could no longer afford the type of home they [...]

THE OUTLOOK: North Berkeley & the Berkeley Hills, Spring 2022 results

There has been a lot going on in the real estate market since my last newsletter, when I wrote that competition between buyers was looking especially intense.  The prospect of increasing interest rates always motivates buyers to find something before rates go up, so they bid extra hard for available properties.  As a result, we saw more incredible sale prices during the spring, and the market reached a new peak. **** NORTH BERKELEY There were 39 properties on the market in North Berkeley over the spring season (March through the end of May), and 27 properties sold.  Of these, all [...]

THE OUTLOOK: North Berkeley & the Berkeley Hills, Annual 2021 & Winter 2021-22 results

It’s time as usual to look at the previous year’s results for our local real estate market, and also talk about the results for the winter season just ended. 2021 started off with a bang. A big upswing in buyer interest led to major competition between buyers, which led to big price increases. The craziness moderated somewhat later in the year as interest rates started increasing and more homes came on the market for sale, but values stayed at the new higher levels. In 2021, there were more properties on the market in both North Berkeley (127 active listings) and [...]

THE OUTLOOK: North Berkeley & the Berkeley Hills, Q4 and Annual 2022 results

Last year was the craziest roller coaster I’ve ever seen in our local market. We started 2022 with an intense surge in buyer activity, but that surge was reversed by the summer and through the end of the year, as buyers adjusted to higher interest rates, concerns about the economy, and declines in the stock market.

***

NORTH BERKELEY:

Looking at 2022 as a whole, the median sold price in North Berkeley was $1,650,000, which is unchanged from the previous year. Average sold price per square foot, at $1046, was up 7% compared to 2021. Properties in North Berkeley sold on average after 19 days on the market, which is pretty typical. Out of a total of 87 sales during the year, only 9 properties had price adjustments before selling (3 were price increases, and 6 were price reductions). 87% of the sales were at prices above list price, and those sold on average for 32% more than list.

The figures for the whole year are of course combining the results from the crazy spring and the much slower latter portion of the year. The fourth quarter data (for October through December 2022) is more indicative of where the market is now. In the fourth quarter, the median sold price for North Berkeley was $1,402,500, which is down 15% from the fourth quarter of the previous year. Average sold price per square foot was $1000, which is also down, but only slightly, by 0.5% compared to the same period in 2021. There was a big change in the number of properties listed for sale during the fourth quarter this year. There were only 20 properties on the market in North Berkeley, compared to 33 during the same period in 2021.

***

BERKELEY HILLS:

In the hills, the median sold price for 2022 as a whole was $1,870,000, which is up 10% from the previous year. Average sold price per square foot was $953, which is also higher, in this case up 11% compared to 2021. Properties in the hills sold on average after 19.6 days on the market, which is the quickest we’ve seen since 2016. There were not a lot of price changes in the hills either. Out of 181 sales, there were only 8 price increases and 7 price reductions. 81% of the sales were at prices above list price, and those sold on average for 33% more than list.

Looking at just the fourth quarter, the median sold price for the hills was $1,661,541, which is down 10% from the fourth quarter of the previous year. Average sold price per square foot was $815, which is also down, but only by 1% compared to the same period in 2021. There were 40 properties on the market in the hills—just under half the number of listings during the same period in 2021.

***

We start 2023 with interest rates about double what they were at the start of 2022. Rates are in the mid-6% range now, and they were in the low 3% range in January 2022. The higher rates have had a big impact on affordability, which reduces demand for properties. Supply though is also lower, because sellers are concerned about market conditions, and they also don’t want to give up existing low-interest loans and borrow at higher rates on a new property.

For people who would be buying their new home without a loan, this is actually a fantastic time to make a move. For those who would be trading a low-interest loan for one with a higher rate, keep in mind that more favorable pricing could more than offset higher interest costs.

 

THE OUTLOOK: North Berkeley & the Berkeley Hills, Summer 2022 results

The real estate market over the summer was noticeably more subdued than in the first half of the year. Buyers were in an absolute frenzy in the spring, anxious to get into the market before interest rates increased, and as a result, prices went up sharply.

Over the summer, the spring spike in prices vanished, as buyers became much more cautious. A number of factors together explain why the summer market slowed. The stock market went down (affecting buyers’ down payment funds), and interest rates went up (affecting affordability). Some buyers could no longer afford the type of home they were previously looking at, and there was a pause as they adjusted their plans and expectations. There were also more buyers traveling this summer compared to last. This is the typical seasonal pattern, where the market slows in the summer because people are away. We didn’t see it last year, when fewer people traveled because of COVID, but this year, it was again a factor.

***

NORTH BERKELEY:

Over the summer, there were 34 active listings in North Berkeley, and 24 properties sold. Properties took a bit longer to sell on average, 19 days, compared to an average of 13 days over the spring.

The median sold price for the summer was $1,675,559 in North Berkeley. This is down 5% from the spring (this is the big spring spike in prices going away), but it is still 6% higher than last summer. Sold price per square foot was $1091, which is actually up 5% from the spring, and up 16% from last summer.

***

BERKELEY HILLS:

The Berkeley hills had 49 active listings over the summer, and 48 properties sold. The average days on the market was higher here too compared to the over the spring: 19 days over the summer, compared to 16 days over the spring.

In the hills, the median sold price for the summer was $1,917,500. This is down 4% from the spring (this is the big spring spike in prices going away), but it is still 20% higher than last summer. Sold price per square foot was $916, which is down 15% from the spring extreme, but up 3% from last summer.

***

Most of the summer sales —88% of them in both the hills and North Berkeley—were over list price, but there weren’t as many offers per property. List prices have finally adjusted upwards, and that, along with the more cautious buyer pool, meant that sale prices were not as far above list as in the spring. We seem to be back to our normal 20% – 30% above list price on average, instead of the 40% -100% overbidding that was common in the spring.

What’s going to happen from here? The market has backed off of the spring’s extremes to a more reasonable level. Barring some major economic upheaval, I think we’ll see a pretty stable market going forward, one that is more balanced between buyers and sellers.

THE OUTLOOK: North Berkeley & the Berkeley Hills, Spring 2022 results

There has been a lot going on in the real estate market since my last newsletter, when I wrote that competition between buyers was looking especially intense.  The prospect of increasing interest rates always motivates buyers to find something before rates go up, so they bid extra hard for available properties.  As a result, we saw more incredible sale prices during the spring, and the market reached a new peak.

****

NORTH BERKELEY

There were 39 properties on the market in North Berkeley over the spring season (March through the end of May), and 27 properties sold.  Of these, all but two sold for more than list price, on average by 35% above list. Nine of the 27 sales (so 1/3 of them) were at prices more than 50% above list. Only one property (a condo on Oxford Street) reduced its price before it sold.

The median sold price for Spring 2022 in North Berkeley was $1,761,348, which is up 14% from the winter, and 11% from Spring 2021. More of the sold properties during the spring were larger homes than we typically see, so that pushed up the median price, and that also pushed down the average for sold price per square foot. At $1040, sold price per square foot was a bit lower than over the winter, but it was still 8% higher than last spring.

****

BERKELEY HILLS

There were 95 properties on the market in the Berkeley hills in the spring, and 70 properties sold.  Of these, all but four sold for more than list price, on average by 40% above list. Just like in the North Berkeley area, about a third of the sales were more than 50% above list price (23 of the 70 sales)! There were no price reductions in the hills, but four properties increased their list price before they sold. This typically means that the property was originally listed below market value, but didn’t get the offers they were hoping for, so they raised the list price to a price the seller would actually accept.

The median sold price in the hills was $2,005,000 over the spring — this is the first time it’s been over $2M.  This median price is up 4% from the winter, and 20% from Spring 2021.  Sold price per square foot was also quite high, at $1077 per square foot.  This figure is up 20% from both last quarter and from spring 2021.

****

Interest rates on home loans are up dramatically, in response to higher inflation and current and expected future rate increases by the Fed.  Most recently, on June 16th, the Fed announced a big 0.75% increase in the Federal funds rate, and home loan rates shot up even more.  Rates on home loans are now at the highest level in the last 10 years (more on this in “Real Estate Answers”).

Because of the higher rates, we’ve seen a definite shift in the market as we head into summer.  Buyers are still out there, but they are more cautious and more picky.  We’re still seeing multiple offers, but not as many offers for each property. In this sort of environment, strategic pricing and well-conceived preparation are absolutely crucial, but when it’s done right, sale prices are as high as ever. My recent listing on Buena Vista Way (2580BuenaVista.com) got 4 offers, fewer than we would have seen earlier in the year, but it still sold for a price the seller was thrilled with!

THE OUTLOOK: North Berkeley & the Berkeley Hills, Annual 2021 & Winter 2021-22 results

It’s time as usual to look at the previous year’s results for our local real estate market, and also talk about the results for the winter season just ended.

2021 started off with a bang. A big upswing in buyer interest led to major competition between buyers, which led to big price increases. The craziness moderated somewhat later in the year as interest rates started increasing and more homes came on the market for sale, but values stayed at the new higher levels.

In 2021, there were more properties on the market in both North Berkeley (127 active listings) and in the Berkeley hills (272 active listings) than we’ve seen for years, but it was still not enough inventory for all the interested buyers.

****

NORTH BERKELEY

115 North Berkeley properties sold over the year, and 79% of the sales were for more than list price. List prices have not increased as much as values have, so all last year (and continuing now) we saw even more serious overbidding than is typical for this area. For the properties that sold over list price, the average was 30% over, but more than 50% above list was not uncommon.  Some Berkeley properties sold as high as double the list price.

The median sold price for 2021 in North Berkeley was $1,650,000, which was an increase of 22% over 2020.  Sold price per square foot, at $984 per square foot, was 11% higher than the previous year.

The winter season just ended (December 2021 through the end of February 2022) was very similar to the start of last year, with intense buyer interest. Inventory was back to its usual low level (there were only 18 active listings, and 17 sales for the 3 months), but buyers again seemed extra motivated and there were some epic bidding wars.

The median sold price for the winter season was $1,550,000.  This figure is lower than for 2021 because more small properties sold, but it is 30% higher than last winter. The average sold price per square foot from December to February was a whopping $1091, which is up 10% from the fall, and up 29% compared to last winter.

****

BERKELEY HILLS

234 properties sold in the hills during 2021. 52% of them sold above list price, by 25% over on average, but again, far far greater overbids (by $1 million or more) were also happening.

The median sold price in 2021 for the Berkeley hills was $1,700,000, which was an increase of 13% over 2020.  Average sold price per square foot, at $861 per square foot, was 12% higher than the previous year.

For this past winter season (December 2021 through the end of February 2022), inventory was low (there were 44 active listings, and 38 sales for the 3 months), but buyer interest was intense.  The median sold price for the winter season was $1,925,000, which is 24% higher than last winter.  The average sold price per square foot was $899, which is up 11% from the fall, and up 12% compared to last winter.

****

So far spring, 2022 is looking like more of the same. Inventory is picking up somewhat, but the prospect of higher interest rates to come (because of higher inflation) is keeping buyers motivated and the competition for available properties very high.

 

 

Your Real Estate Expert for Berkeley and Beyond

  • Deep Market Knowledge
  • Analytical, Strategic, Creative
  • Honest, Adept, Direct

“Marilyn is exceptional. Her knowledge base, enthusiasm for her job, professional ethics, organization, sensitivity to our aesthetic requirements, loyalty and gentle perseverance set her apart.”

-- Bill and Carol Seidel

Marilyn Garcia, PhD

Marilyn Garcia, PhD Broker Associate, Realtor® CA DRE LICENSE #01355514

The Grubb Company 1656 Shattuck Avenue Berkeley, CA 94709

Direct: (510) 390-5406

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