During our real estate market pause, we were predicting and preparing as much as we could. We expected the summer market to be moving fast once the economy was reopened. Buyers have been anxious to move after being forced into reevaluating their housing needs, mortgage rates have remained at record lows and sellers have waited patiently to take advantage of prime seller’s market conditions.
Well, nothing could completely prepare us for what has happened in just a handful of weeks since our markets opened up here in Southeastern Pennsylvania and Northern Delaware. Things are moving so quickly it’s almost hard to fathom. Property listings are going up and getting multiple offers almost immediately. Housing inventory is insanely low and home prices are increasing as the demand far outweighs the supply.
What’s Affecting the 2020 Summer Market?
Let’s take a look at some of the key factors involved in 2020’s summer market, and then we’ll talk about what this all means for both buyers and sellers who are ready to make their moves.
According to this article from the National Association of Realtors® (NAR), the national median listing price reached $330,000 in May 2020. This is a new record high and things only seem to be trending upward in June. Low inventory is one of the biggest factors involved here. Most markets were essentially on hold through all of April, so we saw a 44.1% decline in newly listed properties last month compared to April 2019. Those numbers improved in May, despite the market still being on hold for a good majority of the month in many parts of the country. May inventory declines were at 29.4% year over year. This is still a high number and we expect it to go down even further in June. The Philadelphia Metro area had the greatest drop in year-over-year listings of ANY metro area in the country.
We’re seeing a very condensed summer market, which is what we expected. Nobody is exactly sure what to expect by the time the fall and winter seasons roll around. They usually represent natural real estate slowdowns in our area because of the weather and holidays. This year, we still have so many uncertainties surrounding COVID-19 and whether or not there will be a second wave (and possibly more economic shutdowns) later this year. This has buyers and sellers acting fast to buy and sell while they can. Check out our recent “Musical Chairs” blog article and you’ll see if action today.
Seller’s Market
From a seller’s perspective, now is an incredible time to sell. If you have been taking the downtime to make repairs and get your house ready to list, you are definitely in the driver’s seat as your property should garner a lot of positive attention. That work and patience should pay off with the excellent home values we’re seeing right now and the eagerness of buyers. Offers are rolling in like crazy on almost every listing that hits the market lately!
If you have been on the fence about selling, now might be the time to get off that fence and take advantage of these market conditions. If you want to stay in your home and you are in good financial standing, now is also a great time to consider refinancing your mortgage while interest rates remain low. Even if your home isn’t quite ready for sale because it needs repairs or a fresh paint job, you may still want to take action and do what you can to get it on the market sooner rather than later.
What Buyers Need to Know
For buyers, you are going to have to expect to pay more for the home you want as prices continue to rise. Mortgage rates are still very favorable and that should help you afford more. Your biggest challenges will actually lie in qualifying for a mortgage and making your offer stand out above the rest. You have to act quickly in this current market. At the same time, you need to make smart decisions and be as prepared as possible.
Check out our recent Cyr Team Blog article entitled “How to Make Your Purchase Offer More Attractive” for some helpful tips and information. This will include getting pre-approved for your mortgage loan and other preparation strategies that will help you get a leg up on your buying competition.
Meanwhile, buyers are still limited by the opportunities to see properties listed for sale. You not only have a very fast-moving market where listings are getting a lot of offers quickly. You also have COVID-19 regulations that make it harder to schedule personal home tours. As a buyer in today’s market, you have to utilize the technology available to search available homes and gather as much information as you can before you start making offers.
Check out the latest Cyr Team Minute:
Whether you are buying or selling this summer, you have to act quickly and decisively. The more prepared you are, the better.
We hope you find this article informative and helpful. If you have any real estate questions or you are ready to buy or sell a home in this area, contact The Cyr Team today!