If you’re following what’s happening in the housing market right now, you know that many people believe the winter months aren’t a good time to sell a home. As realtor.com Senior Economist George Ratiu recently noted,
“Sellers tend to be more reluctant to list during the colder time of year when the market typically makes a seasonal slowdown.”
However, a recent report by ShowingTime reveals how this year is different. Buyer activity is way up compared to the same time last year. The report explains,
“The nation’s 12.6% growth in home showings compared to 2018 was the most significant jump in buyer traffic during the current four-month streak of year-over-year increases. The West Region saw the greatest growth in activity, with a 23.1% jump – the region’s greatest in the history of the Showing Index.”
It seems the more things change the more they remain the same.
In many ways, the challenges buyers have faced in the past will persist in 2020 as they search for the home that’s right for them at affordable price points. Inventory has steadily declined since 2015 and economists predict the lack of homes will persist into 2021. Although single family home construction will increase, it could be years until supply catches up with demand.
Some good news
Mortgage rates are expected to remain under 4%. Crazy low rates compared to the 17% interest rates my friends and I faced when we were buying our first homes! Millennials, now between 30-39 years old are the largest buying segment of the population. Many prefer to live in S.F. or other larger cities, but will be drawn to more affordable areas. Texas, Arizona and Nevada should see see an influx of Millennial home shoppers that have been priced out of California.
Sellers, good new for you!
Prices will stay strong, still moving upwards albeit more slowly. The number of sold homes is expected to decline and days on market to increase. Entry-level homes will fly off the shelves while luxury property sellers will be on the market longer and may should think about the market trends price competitively.
As the market moves towards a more balanced situation, sellers who adjust to local market conditions quickly can benefit from continued demand. Success will be achieved with a more thoughtful, smart approach to pricing and a bit more patience.