Three 2022 market predictions that make a lot of sense
And, what you need to know about pocket listings
Good morning!
đź‘‹ A special hello to those of you joining us from Morning Brew! Welcome to The Blueprint, an honest, straight-to-the-point newsletter that breaks down the biggest residential real estate topics into snackable bites.Â
Whether you’re an agent, broker, investor, or enthusiast, information is essential in this quickly evolving market. We created The Blueprint so you can be at the top of your game when it matters most.Â
Here’s your new bi-weekly routine: wake up, read The Blueprint, close some deals, repeat.
- James and David
Today's Blueprint:
The 2022 housing market, as predicted by Redfin
This is why home stuff is so damn expensive
Uncovering some not-so-secret listings
What you should do right now to end 2021 strong
Redfin's three trends to watch in 2022
If there's anything we've learned in the last two years, it's that predictions can be.. well, unpredictable. That being said, here are three trends to watch next year, according to Redfin:
It’s the high-rise life… for buyers. Expensive single-family home prices will encourage more buyers to look for condos. Expect this market to expand if COVID numbers improve.
iBuyers will chill out. No more buying thousands of homes, offering $65K above value, and striving for complete market domination. iBuyers have tasted bitter reality and will shrink back to their rightful place: serving a niche group of sellers looking for a quick sale.
Mortgage rates move onwards and upwards. By next winter, look for mortgage rates to top 3.6%. That’s an increase of about $100 per month for a typical mortgage payment.
Check out Redfin’s full report here.
Our take
You're going to hear a lot of different predictions this year, but here's one you can bank on: this is the best time for your clients to sell because they’ll get a historic price. It’s the best time for buyers too because this could be the lowest interest rate they’ll get in their lifetime. The property may cost a little more than it did last year, but to lock in a great rate for 30 years? Pay a bit more now and they’ll be guaranteed lower payments for the next 30 years.
The supply chain crunch lingers on
Stroll through Lowe’s and you’ll find just about the only thing on shelves are out-of-stock signs. Chalk that up to huge peaks in renovation and homebuilding, coupled with bottleneck backups and factory closures. The renovation and new-build essentials most impacted by the crunch are lumber, appliances, paint, and furniture.Â
Unfortunately, experts believe we’ll still be facing these issues into 2023. Labor shortages, shipping challenges, and high tariffs on some goods mean the supply chain problem may worsen next year before it improves.
Our take
If your buyer is looking at fixer uppers right now, show them comparable turnkey homes when possible. Chances are your clients will spend less money on a move-in ready place than on a project home that needs considerable work.Â
The changing face of pocket listings
Pocket listing | “pah-ket lis-teeng” | A bougie noun
def. When an agent has a signed listing agreement on a property but privately markets it without putting it on the MLS. AKA an off-market listing or exclusive listing.Â
An estimated 4% of all homes sold in May 2021 were pocket listings. In luxury markets, these exclusive sales are even more common. In Q2 2020, an estimated 27.5% of sales in the priciest Downtown and West Side L.A. markets were pocket listings.
Pocket listings are technically a no-no, as far as the National Association of Realtors is concerned. In 2019 the NAR passed a real wet-blanket of a rule that requires realtors to submit their listings to an MLS within a day of marketing the property. But an increasing number of off-market startups, exempt from the NAR’s restrictions, are popping up across the country.
Our take
Pocket listings are in high demand in the luxury market because many of these sellers want to keep looky-loos out of their backyard. They can also be a helpful tool to make sure you’re pricing your property correctly before it officially hits the MLS. That being said, going to market usually generates greater buzz, more offers, and better value for most properties.Â
You don’t want to get on the NAR’s bad side. Always follow their guidelines on pocket listings.
SchematicsÂ
The news that just missed the cut
Over $100M in metaverse land changed hands in the last week of November
There’s been a shakeup in the list of top 10 most expensive global cities
Here’s how to keep a real estate purchase confidential
This historic Hollywood mansion is one of our most unique listings of the year
Catch James’ interview with Morning Brew about the biggest trends in the lux market
Foundation Plans
Advice from James and David to win the day
When all you want to do is kick your shoes off and snooze until December 31st, it’s tough to stay focused on closing the year strong. Here’s how we stay motivated as the last month of the year winds down:
Keep your clients on track. Stay on top of your current clients to make sure your in-progress deals close smoothly. At this time of year, things can go squirrely fast if you’re not constantly on the ball.Â
Pick out your holiday gift. Sometimes you need to give yourself a little incentive to stay focused. If you hit your December sales, dials, and door-knocking goals, reward yourself with that small-batch Scotch or Hermes clutch. You deserve it!
Seek out accountability. Find another agent, maybe in your network or at your agency, to help hold you accountable to your year-end goals. We all need to have someone around to give us a good ol’ kick in the pants now and again.
Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
If you’re new to the Blueprint community, we want to hear what you think! What’s your take on today’s stories and tips? Reply to this email with your comments, questions, or suggestions.Â
In the meantime, keep closing deals and picking up leads. The win is worth the hustle!Â
See you on Friday.
- James and David