The San Francisco real estate market just had one of its strongest years in history. Values soared, buyers swarmed around almost every listing, interest rates were at crazy lows and sales volume doubled over 2020.
Everyone is wondering what 2022 will bring, and I have a few ideas. I’ve been selling real estate in the city since 2002, and have gotten pretty good at reading that crystal ball all Realtors have.
If there’s one phrase that will likely apply to San Francisco real estate in 2022, it’s this—more of the same.
Inventory will be tight, as always. People will sell their homes in a bid to cash out, relocate closer to family or for work. But there won’t be sufficient supply to meet all the demand. There will be at least another year of multiple-offer situations, buyers waiving contingencies and overbidding the list prices.
There are rumors that the Fed will be raising interest rates. That might put downward pressure on real estate prices if such a hike happens. But the whole supply and demand thing will still be a big factor.
I’m thinking that prices could rise in 2022, though not dramatically. The average price for a single-family house in Q4 2021 was $2.3M, and $1,424,000 for a condo, which are pretty high averages in comparison to the rest of the country. Yet I think we can expect values to rise—just not tremendously so.
And finally, I’m predicting that lots of San Franciscans will invest in second homes outside the city. I’ve had multiple clients ask me for referrals for agents in Tahoe, Napa, Palm Springs, and Sea Ranch over the past week. Most are planning to be work from home indefinitely and are seeking a change in scenery.