Year-End 2022 Mid-Valley Market Report

Here is our recap on the market in 2022:

The beginning of the year continued the strength of the 2021 market – high demand, increasing prices, Sellers’ market. The height of the post-pandemic market peaked in May and June 2022. Economic concerns and the introduction of higher interest rates in April and May triggered a noticeable pause in sales starting in July and August. Therefore, the 2nd half of the year was considerably slower – by fall, we started to see price drops in most areas and longer days on market while Buyers waited for prices and interest rates to settle.

As of year’s end, the number of sales in every area dropped significantly (by almost half in some areas) to what we saw in 2011 – 2012. The average percentage of sold price to list price has also dropped 3 – 5% compared to last year (it was 100% or 101%; now 95% – 97%). We attribute this to record high prices and a sharp increase in interest rates – the combination lowered Buyer demand considerably. Still, average sale prices and average sold price per sq. ft. reached all-time highs in 2022. We expect, however, to see those metrics decline in 2023 in response to what we think will be a slow shift to a more balanced, buyer-friendly market this year and next.

For Sellers, prices are still incredibly high – even though they have already started to decline in some areas, they are still as high as what we saw in 2021 and 2020. Inventory is still low. Sellers should expect that Buyers want to negotiate and will take their time making purchase decisions, now that the frenzy is over. For Buyers, there are always motivated Sellers out there and we are seeing many sales at considerably lower prices than the original list price. Mortgage companies are offering creative financing and are optimistic that interest rates will settle in time, offering the hope of refinancing later on if needed.