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Home Value Forecast: 2021 End-of-Year Review of the Residential Real Estate Market

Happy Holidays from Pro Teck Valuation Intelligence!

For the final Home Value Forecast of the year, we will examine trends over the past 12 months and list the top three CBSAs in the following categories:

  • Highest Current Sales Price
  • Current Months of Remaining Inventory
  • 12 Month Sales Price Appreciation

This will be the eighth year we have done this year-end analysis.

CURRENT SALE PRICE

For 2021, the three California metros of San Francisco, San Rafael and San Jose earned a place atop the list of CBSAs with the Highest Current Sales Price. These three metros have been leading this category since we started this review in 2014.

2021_endofyear_ProTeck_HVF_Charts_1

As 2021 nears its end, there are nine metros where the average home costs more than $1 million:

2021_endofyear_ProTeck_HVF_Charts_2

MONTHS OF REMAINING INVENTORY (MRI)

MRI is another indicator of how “hot” a market is at a particular time. MRI equals the number of households on the market divided by the number that sell per month. If an area has a high MRI (let’s say 10 months), it means that the market is saturated — a buyer’s market. If MRI is low (below three months) then it becomes a seller’s market. A “balanced” market will have approximately six months of inventory at any given time.

The top three markets in terms of MRI for 2021 are:

2021_endofyear_ProTeck_HVF_Charts_3

In total, there are 182 CBSAs with MRIs under three months – clearly due to the impact COVID-19 is still having on the market.

As of this month, all 229 CBSAs we track have MRI below the six months “balanced” market threshold.

12-MONTH SALES PRICE APPRECIATION

In our report, sales price appreciation is calculated as the rolling three-month average sale price compared to the same three-month time period from the previous year. Our top three all had more than 27% appreciation from the same time last year:

2021_endofyear_ProTeck_HVF_Charts_4

While the Austin market has been hot for a while, prices have increased dramatically over the last two years.

Graph of average sold price per single-family house

The 2022 real estate market will be dynamic, especially if the Fed begins increasing rates to temper inflation.

This Month’s Top 10

Each month, Home Value Forecast uses a number of leading real estate market-based indicators to report on activity in the single-family home markets in the top 200+ metropolitan areas (CBSAs) in the U.S., and reports on the Top 10.

The Home Value Forecast Top 10 ranking system is purely objective and is based on directional trends. It’s not a listing of what markets are most expensive or most in need of inventory — it ranks market momentum at a specific point in time.

The Last Top 10 of 2021

From all of us at Pro Teck, we hope you and your family have a happy and healthy 2022!

ABOUT PRO TECK’S MONTHLY HOUSING MARKET REPORT
The Home Value Forecast uses a ranking system that is purely objective and is based on directional trends of nine market indicators. Each indicator is given a score based on whether the trend is positive, negative or neutral for that series. For example, a declining trend in active listings would be positive, as would an increasing trend in average price. A composite score for each CBSA is calculated by summing the directional scores of each of its indicators. From the universe of the top 200 CBSAs, each month we highlight topics and trends in the real estate market.

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