If you can spare 10 minutes reading this report, then you can win more offers.
Sundae’s Q3 market report will show you how to effortlessly spot real estate trends and adapt to stay ahead of the competition. As you read the report, you’ll gather the ammunition you need to make informed investment decisions. It’s intended to show you things that you can use to adjust your approach such as:
- Changes in buyer preferences, including sizes, types, and areas.
- Emerging trends to take advantage of and implement in your business.
- Proprietary data showing what your competitors are doing and how to stay ahead.
That way, you can make the most of your experience on Sundae’s marketplace. This article breaks down each section and gives a sneak peak into what you’ll learn in our market report.
National real estate market overview
The report starts with an overview of what’s happening at the national level. Factors such as migration patterns, interest rates, and inflation trickle down to the local level. National trends cause local investor and buyer behaviors to shift.
We are bullish on real estate moving into 2022. Economic and general real estate trends imply that competition will remain strong. However, there is still upside in markets across the country. These are some noteworthy considerations as you make your next investment.
Interest rates remain historically low. As such, people continue to leverage capital to buy property. It also means that those buying houses will have lower monthly payments than generations before them. Expect the demand for houses to remain high. Something to be cognizant of is how the Federal Reserve adjusts rates in 2022.
Another noteworthy, but unsurprising trend is the increased demand for starter homes. 3-bedroom, 2-bathroom houses are the most sought-after property type. They are in high demand as there are fewer being built. Look for investors to target value-add properties across the country to meet consumer demand.
Following these trends allows you to ask “how does this impact my business?” and serves as a way to make informed decisions.
California: a market-by-market overview
From the big picture, the report then delves into local markets. No two places are the same, so if you’re looking to expand to new markets, this will show you the lay of the land. As a seasoned investor in a certain market, there’s also value to be had. You’ll be able to see how buyer preferences change, emerging trends to take advantage of, and even what your competitors are doing.
As people began leaving major cities in favor of space, the Inland Empire became a popular housing destination. Investors began to enter the market as well, seeing opportunities throughout the region.
Inland Empire buyers come to the area in search of more square footage. The median sized home flippers sold here hovers around 1,500 square feet. Oftentimes, this comes in the form of more bedrooms. People want more space to offer flexibility for not only sleeping, but a home gym or office space, and more. Investors who find ways to create more space, whether through additions, ADUs, or otherwise, appeal to buyers in this area.
While city living was interrupted by COVID-19 early on, Los Angeles is now seeing growth. Investors are leveraging creative real estate strategies to capitalize on this ever-expanding market.
In 2021, condos came back in style in Los Angeles. This past year they saw a 3% increase in flips, which reflects gathered confidence that things are returning to “normal.” As people begin to go out, socialize, and work at offices again, many seek the convenience that condos offer. These properties may be overlooked by investors and could offer upside when selling to Millennial buyers specifically.
It’s worth noting that the impact of the Omicron stand of COVID is yet to be seen. Pay close attention to how the market, the government, and buyers respond as we learn more.
Many who feel out priced in San Francisco or want more space than it can offer are looking across the bay. Oakland has many of the same general trends as other markets, yet there are distinct differences that present unique opportunities.
One particular difference from other coastal city markets is that people are seeking more bedrooms in Oakland. While cities are not generally known for spacious living, 4-bedroom homes were flipped 10.28% more in 2021 than in 2020. Yes, 3-bedroom houses remain the most popular, but this trend shows interest in flex space from buyers working remotely. Are there opportunities to add another bedroom to your next flip?
It could be worth investigating in Oakland.
People seeking more space and affordability relative to the Bay Area are flocking to Sacramento. In this competitive market, investment opportunities abound for those who understand the local trends.
The Sacramento market heated up in a big way during 2021. As people began to move here, the demand caused prices to skyrocket. This didn’t deter investors from buying at higher price points. The median investor purchase price increased by 63.09%. Investors are willing to pay more in this market because they see further upside.
This sunny southern California market offers amazing weather in every season. It’s no wonder that people with a variety of backgrounds want to live in San Diego. Investors here are willing to compete, even as prices increase.
One thing to be cognizant of is the power of the almighty dollar. Cash offers from non-investors became increasingly popular during the pandemic, creating more competition for both on and off market deals. As such, investors are more likely to make cash offers. In 2021, cash offers increased by more than 10% in San Diego. This serves as a reminder to line up funding ahead of time and to build your network out. That way, you’ll have more options.
Win more offers using the quarterly report
These insights give you the information needed to take action. This might mean adjusting the property types you’re targeting, finding creative ways to add space, or placing offers on condos.
Use this powerful tool to determine how you can better your business.
Kyle is Sundae’s Real Estate Editor. As both an investor and content marketing professional, Kyle combines his passion for real estate investing and educational background with his love of helping others. His experience with real estate tech companies, including contributing to BiggerPockets Pro, gives him insight into markets across the United States.