Marin Community and Real Estate Market Report - 3/1/2022

Patrick Carlisle's report:

"New wealth: Federal and state governments shoveled trillions of dollars to businesses and households

. Financial markets soared, dramatically increasing the personal wealth of middle class and 

more affluent households. These factors contributed to the sense of being wealthier than 

ever, which helped supercharge the housing market. The households which suffered unemployment, illness and 

financial hardship were generally less affluent, and more likely to be tenants than homeowners or home buyers. 

 

Interest rates: The Fed implemented policies that brought mortgage interest rates down to historic lows, significantly 

lowering housing costs, and motivating prospective homebuyers to buy sooner than later. (The risk is that if interest 

rates jump, perhaps due to inflationary pressures – and we are not saying they will – it could have a pronounced cooling 

effect on the market, as it did in mid-late 2018.)

 

 

Demographic shifts: According to census data, many more less-affluent/less-educated residents have left CA than have 

arrived in the 10 years through 2019, but more higher-income/more-educated residents arrived than departed. This 

dynamic prevailed in the Bay Area as well, and out-migration of the less affluent accelerated in the Bay Area since 

Covid hit. Affluent, suburban Marin, with its gracious towns and enormous parklands (and good schools), saw a 

further influx of affluent and very affluent buyers – mostly from densely populated (and more expensive) San 

Francisco, also dealing with a number of negative urban issues – competing for an inadequate supply of Marin homes 

for sale.

 

 

Home prices rose 18.6% annually in June, up from a 16.8% increase in May, according to the S&P CoreLogic Case-Shiller national home price index. Prices are now 41% higher than their last peak during the housing boom in 2006. Home prices continue to surge due to strong demand and persistent low supply. (CNBC)

 

Due to a number of factors - inflation, international developments and other issues - serious increases in interest rates have continued in 2022, hitting 3.92% in the past week (up 26% in the past 6 weeks), according to Freddie Mac. Below are 3 angles on interest rates, plus the latest inflation reading for January (which hit a 40-year high). Interest rates can change very rapidly up or down, and it's extremely difficult to predict those changes with any accuracy. Whether these changes shall continue, the magnitude of such changes, and how exactly they might (or might not) affect the market is still developing."

Top 10 Compass agents in Marin

 

$100 million in sales

 

Sales from $895,000 to $20,000,000

 

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