iCrowd Newswire - Aug 27, 2020
Buyer demand has shown no signs of slowing down as homes are selling nine days faster than this time last year, despite 15 consecutive weeks of solid price growth, according to realtor.com®‘s Weekly Recovery Report for the week ending Aug. 22. With national inventory down 37 percent year-over-year, buyers’ heightened demand is creating a marketplace that tilts the scales in favor of sellers as bidding wars, multiple offers and a blistering pace of sales become the new normal.
The realtor.com® Housing Market Recovery Index reached 106.6 nationwide for the week ending Aug. 22, posting a 1.8 point increase over last week and 6.6 points above the pre-COVID baseline of January 2020. The ‘housing demand’ component of the index, measured by growth in search traffic, remained above the recovery baseline, with this week’s index reaching 124.1, the highest index value since March. However, the ‘housing supply’ component, measured by new listing growth, declined back down to 95.5, after having briefly surpassed the recovery baseline two weeks ago.
“There’s a record level of buyers competing in the housing market right now,” said Javier Vivas, director of economic research for realtor.com®. “In a typical year, buyer-seller activity would be dwindling down heading into Labor Day, but 2020 has been nothing short of abnormal. It may be late August, but we’re in the thick of the homebuying season, with busy open houses, multiple offers and even bidding wars becoming the common theme in many markets. First-time home buyers face the biggest hurdles and have to lean on financing to keep their home ownership dreams alive”.
Weekly listings data findings:
- Time on market is now nine days faster than last year. Whether the urgency comes from a desire to lock in a low mortgage rate or to make a bid before someone else does, buyers are moving faster than this time last year. This means homes are sitting on the market for less time, despite higher price tags.
- Total inventory was down 37 percent. Buyers are motivated by low mortgage rates and a strong desire to find their own place as the remote work trend begins to look long term. They’re quickly putting offers on homes that come up for sale, evaporating the overall number of homes for sale. Any other insights on what is driving down inventory?]
- Median listing prices grew at 10.3 percent over last year, the fastest pace of growth since January 2018. This marks the 15th consecutive week of price growth at or equal to the previous week’s yearly pace–a remarkable feat considering the economic backdrop of a recession and continuing job losses. Consistently rising home price growth is the market’s answer to balancing the insufficient availability of homes for sale against a steady stream of homebuyers.
- New listings were down 13 percent. The new listings trend lost some additional momentum for the second week in a row, but remains well above mid-April lows. Home sales surged in June and July as pent up buyers flooded the market. More new sellers could keep sales elevated into the fall, but on the other hand, fewer new sellers could mean more price growth.
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Cody Horvat, email@example.com