As a homeowner, you want to get the most out of your investment. Whether you're planning to sell your home soon or just want to increase its value over time, there are several steps you can take to
Chico Housing Market Update - 2022 Review
Dated: January 7 2023
Views: 123
Happy New Year! We have put together a comprehensive review of the last year’s market activity and broken down some of the key metrics by quarter of the year to examine what happened. The chart compares each quarter to the same quarter in 2021, this is to give better context as the real estate market is seasonal.
What do these numbers mean?
The first metric that we have chosen to look at is the number of new listings. As the year progressed the number of listings dropped off dramatically this is likely due to sellers not feeling like it is a good time to sell or being deterred from buying a replacement property and losing the low interest rate that they have on their current home. Effectively even if someone was to move to a home of equal value, their payment would be much higher. This created what has been termed a “lock in effect” and is likely to prevent a surplus of inventory - as the demand goes down, so does the supply. There was a spike in the second quarter, the likely cause of this was sellers rushing to get their home listed before the market shifted further.
The next metric is the total number of sold homes. This provides insight into buyer activity. As the year progressed many buyers were priced out of the market resulting in a dramatic drop in the total number of sales. It was particularly difficult for buyers to accept the higher monthly payments they would need to make for a home compared to just a few months earlier. Many buyers decided to hold off on buying as they expect rates to come back down.
The median sales price dropped in the last half of the year albeit very slightly. There was a lag time in the price moving as buyers and sellers adapted to the new market. The median sales price is useful for giving us an idea of the total amount of money being spent rather than individual home values.
The dollar per square foot is a useful figure as it automatically adjusts for the fact that some parts of the market have been hit harder than others. The disparity between the $/sqft an the median sales price is caused by the slowdown hitting larger homes harder. That makes sense when considering that an increase in interest rates has a much greater impact on large mortgages than it does on smaller ones. We did see a drop as the year went on but it was much less dramatic than the overall sales price. This is the best indicator of individual home values - unless you bought in the last 12 months, your home is still likely to be worth significantly more than what you paid for it.
Median days to sell was one of the most drastic changes that we observed and it really changed how the housing market “feels”. The likely reason for the sharp increase is the time that it took for sellers to adjust to the new market. Homes are generally priced on recent comparable sales. If prices are declining, the price that a home is often listed for higher than the current value and price reductions are needed to get it to a price that buyers are willing/able to pay due to increasing interest rates.
We have included the average 30yr fixed mortgage rate as this has been the main factor driving the shift in the market. Getting into the details of the factors that cause mortgage interest rates to fluctuate is beyond the scope of this article. However, the recent rate increases have been driven by the Federal Reserve raising the Federal Funds Rate in an effort to slow down inflation.
What can we expect in 2023?
The short answer is that nobody knows for sure. There are however some pieces of information available that allow us to make some sensible assumptions about what the next year will look like.
The Federal Reserve have stated an intent to continue raising rates. The good news is that mortgage lenders have already priced this in so we are unlikely to see any more sharp upward movements in rates. There is a possibility that as inflation figures start to show a reduction, the Fed will soften their approach and this will lead to a slight reduction in rates, with many analysts predicting that we will settle back around the 5% mark.
What should I do about buying or selling in 2023?
The fact that we do not know what is going to happen means that you should not try to “time the market”. Buy when you need to buy and sell when you need to sell. Trying to anticipate what is going to happen and waiting is not a good strategy.
For buyers: if you are planning to buy a home but waiting for rates to come down, there is a chance that they will not come down and even if they do, there will be much more competition from other buyers doing the same thing, so you will end up paying a higher purchase price. If you buy when rates are higher you can get a better deal and if rates go down you can always refinance, if however rates go up, you will be glad you locked it in when you did.
For sellers: be realistic with expectations and instead of focusing on what your home was worth 6 months ago, look at how much values have increased since you purchased (undoubtedly a lot if you purchased more than 18 months ago). Pricing your home correctly is more important than ever. Homes that are priced appropriately are still selling pretty quickly but homes that are priced based on 6 month old comparables are sitting on the market and not selling.
Ultimately, don’t be afraid of the current market. The real estate market is cyclical and the current conditions are temporary. If you are planning to make a move this year let us know as soon as possible so that we can help you come up with a strategy.
As always feel free to reach out if you would like more detail on anything covered in this report or if you have any questions.
To be receive our mothly market update email, sign up HERE
Nick & Brittney Allison
We are a Husband-Wife real estate team located in Chico and serving the wider Butte County area. As professional full-service Realtors, we are able to assist buyers, sellers and investors at all stage....
Latest Blog Posts
Buying a new construction home can be an exciting and daunting experience, especially if you’re a first-time homebuyer. It’s essential to weigh the pros and cons of purchasing a new
Condominiums, or condos, are becoming an increasingly popular choice for homebuyers. A condo is a type of housing where an individual owns a unit within a larger building or community. In this
Owning a home is a significant investment, and maintaining it requires time, effort, and money. Over time, wear and tear on a home can cause various repairs to become necessary. Some repairs are
Based on information from California Regional Multiple Listing Service, Inc. as of September 11, 2026 5:17 PM UTC This information is for your personal, non-commercial use and may not be used for any purpose other than to identify prospective properties you may be interested in purchasing. Display of MLS data is usually deemed reliable but is NOT guaranteed accurate by the MLS. Buyers are responsible for verifying the accuracy of all information and should investigate the data themselves or retain appropriate professionals. Information from sources other than the Listing Agent may have been included in the MLS data. Unless otherwise specified in writing, Broker/Agent has not and will not verify any information obtained from other sources. The Broker/Agent providing the information contained herein may or may not have been the Listing and/or Selling Agent.
This information is deemed reliable but not guaranteed. You should rely on this information only to decide whether or not to further investigate a particular property. BEFORE MAKING ANY OTHER DECISION, YOU SHOULD PERSONALLY INVESTIGATE THE FACTS (e.g.square footage and lot size) with the assistance of an appropriate professional. You may use this information only to identify properties you may be interested in investigating further. All uses except for personal, non-commercial use in accordance with
Last updated: September 11, 2026 4:42 PM UTC Property Information © 2026 
Bay East ©2026. CCAR ©2026. bridgeMLS ©2026. Information Deemed Reliable But Not Guaranteed. This information is being provided by the Bay East MLS, or CCAR MLS, or bridgeMLS. The listings presented here may or may not be listed by the Broker/Agent operating this website. This information is intended for the personal use of consumers and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Data last updated at September
Listings identified as belonging to another listing broker/agent are based upon data obtained from the Multiple Listing Service of Shasta Association of Realtors and is copyrighted by the Shasta Association of Realtors, but is not warranted.
The information on this web site is provided exclusively for consumers' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. We are not responsible or liable
The information being provided by Conejo Simi Moorpark Association of REALTORS ® ("CSMAR") is for the visitor's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties visitor may be interested in purchasing. Any information relating to a property referenced on this web site comes from the Internet Data Exchange ("IDX") program of CSMAR. This web site may reference real estate listing(s) held by a brokerage firm other than the broker and/or
The MLS™ I-Tech ® All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumer's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in
