February 2022: There were 81 closed sales in January, down 35% from 124 sales in January 2021, largely due to lack of inventory. However, there was a total of 2028 SFR sales for 2021, the most since 2005 when there were 2257 sale for that year. The highest number of sales in a year was in 2004, when there were 2820 sales. In fact, for the decade ending in 2005, there was an average of about 2400 sales each year.
Mortgage interest rates are rising, and that will initially motivate buyers to act before rates go higher, especially since rates are still historically low. But if rates continue to rise throughout 2022, that will eventually have a cooling effect on the number of sales. The Fed began to taper off the purchase of mortgage bonds in November, a policy that has been in place since the beginning of the pandemic to force mortgage rates down to record lows (the all-time record low mortgage rate was broken at least 17 times during the pandemic).
BACKGROUND: A sale, in this context, means a close of escrow. For example, July sales mean houses that closed escrow between July 1 and July 31, but probably went under contract in May or June. The number of sales is seasonal. Each year, January and February have the fewest number sales, because people are usually too busy to shop for homes during November and December. The highest number of sales is in June or July, because more buyers shop for homes in the summer. Note this repeating annual pattern in the above graph.