March 2023

After the acute decline in market activity occurring in the 2nd half of 2022, buyer demand rebounded dramatically and most market indicators turned positive in early 2023: Open house traffic, number of offers, overbidding and absorption rates all saw substantial improvement.

It is too early for significant effects to show up in home prices: Indeed, through February, 3-month-rolling median house sales prices saw YoY declines across all Bay Area counties. Even with the striking improvement in demand over late 2022, most YoY indicators remain depressed, but these comparisons are with the severely overheated conditions prevailing at the peak of a 10-year housing market upcycle.

The market was still just waking up in February. March through May is typically the most active listing and sales period of the year, and should soon provide much more data on supply, demand and price trends. Over the last 3 years, spring markets were deeply affected, in very different and often surprising ways, by the onset of the pandemic (2020), the pandemic boom (2021), and soaring interest rates (2022).