Each Friday, Robbie Briggs, CEO of Briggs Freeman Sotheby’s International Realty, writes about luxury, trends, business and more in the advertising pages of the Mansion section of The Wall Street Journal. Below is his letter of April 22, 2022.
FROM MY PERSPECTIVE
We were right. We predicted in our final market report for 2021 that the first quarter of 2022 would prove to be a very busy period. The ever-shrinking supply of homes for sale — called inventory in our world — combined with the unprecedented and ongoing buyer demand have created a climate of brisk, competitive activity.
That historically low inventory is starting to affect the market, leaving the actual number of sales trailing behind this time last year. But, demand remains elevated and, in most of our North Texas markets, so are the sales prices — so the total sales volume in dollars is actually up. Properties new to the market are swift to go under contract after multiple offers, and they are realizing higher prices. In fact, average home prices nationally increased by a whopping 18.8 percent in 2021, the highest annual increase ever, according to the S&P CoreLogic Case-Shiller National Home Price NSA Index.
A fundamental change has certainly driven heightened interest in our markets: The pandemic-fueled movement to remote working appears here to stay, allowing workers to reprioritize their lifestyle needs without basing them around commutes. A generational shift has also occurred. According to a March story on Inman, a news source for agents and brokers, millennials accounted for nearly half of all home purchasers in 2021 — a notable development considering that previous reports from multiple sources had always dismissed the group as less likely to buy.
We expect the trend we are now observing — declining quarterly sales figures with limited inventory but rising prices — to continue. The recent uptick in mortgage rates should only further motivate consumers to buy before the rates increase. Even with inflation and those increasing rates, the intrinsic value of owning and investing in real estate has not changed, and for many it remains an integral part of their overall wealth strategy.
We’ve crunched the Q1 numbers and have them summarized for you at briggsfreeman.com/market-moves. I hope you find it valuable. But, talk to your Briggs Freeman Sotheby’s International Realty agent, anytime. No one knows how to make sense of a market — hot or cool — like they do.