Here’s the latest news on the spring real estate market in our area.
The spring real estate market is back with a vengeance. After a full year of dealing with COVID-19 here in the U.S., a vaccine surge is on the horizon and the economic outlook is positive. March, a historically active month for the market, is once again poised for strong performance.
Home prices continue to surge despite a slight dip in demand. The recently released S&P CoreLogic Case-Shiller 20-city price index shows that home prices have been increasing at the fastest pace since 2014. It was also reported at the end of February that total mortgage application volume fell by 11.4%. That’s largely due to interest rates climbing back up into the high 2s and low 3s.
While it’s clear that 2021 won’t be a second consecutive year of watching rates limbo to new lows on an almost monthly basis, the Fed still intends to keep rates artificially low. Furthermore, millennials—the largest generation in American history—will continue to pour into the market after helping Zillow’s traffic skyrocket to 9.6 billion visits last year.
However, an uptick in inventory this spring may thaw our market. An intensified seller’s market emerged in the wake of the pandemic. It has led to homes in some markets fetching a jaw-dropping number of bids before going under contract for tens of thousands of dollars over list price.
At the same time, it also hampered sales a bit. Pending home sales fell in January because there are simply not enough homes to match the demand on the market.
With more sellers primed to enter the market, weary homebuyers may find a smidgen of relief—but they still won’t be calling the shots. (Offers over list price will still be par for the course).
Would-be sellers who sidelined their plans last spring due to COVID-19 may feel more optimistic this time around. They’ve watched the 2020 housing market triumph in the face of adversity, and they’re seeing consumer confidence rise now. More inventory this spring could grease the wheels of the housing market and lead to huge increases in sales.
What does this mean for you? Though some buyers may be deterred by interest rates ratcheting up a bit, many more are rushing to lock in affordable monthly payments while they still can. For sellers, the competition will increase markedly over the next few months. Netting top dollar is still more than possible, but overpricing a home and failing to prepare it for the market is a losing strategy.
Buyers and sellers alike need to work with a skilled professional to navigate this market madness. If you’ve even been entertaining the idea of selling your home at all this year, I invite you to give me a call or send me an email today. I’d love to hear from you and answer any questions you may have.
Teaser: As we head further into spring, I want to bring you a quick update of where our real estate market stands. After a full year of dealing with COVID-19, the outlook for this spring and summer are strong. Home prices continue to surge and although demand has dipped slightly, it’s still driving our market. Inventory remains extremely low and home sellers are reaping the benefits. At the same time, homebuyers are still able to lock in historically low interest rates. To learn more about what’s going on in the market, watch this short video.