2020 Real Estate Market Review

2020 Real Estate Market Review

2020...... What else do I need to say.  A year of fear and chaos.  Well here we are in 2021 and as much as no one wants to look back at 2020, in the real estate world it is always good to look at where we were to try and figure out where we are going.

In February of 2020, we had no idea what the rest of the year would bring for our real estate business.  We were down right fearful that the bottom would drop out and we would be in uncharted territory.  Well, thank goodness that wasn't the case.  While many sectors of our economy took a beating and many families lost their livelihoods, real estate had an overall great year.  March and April were slow.  Everyone was trying to figure out what was going to happen.  Then in May, families started to realize that they have to move forward with life and if buying or selling a home was a necessity, that is what they did. 

Here is a summary of how the year ended up.

  • Inventory was down:  There were almost 10% less homes on the market in 2020 than in 2019
  • Sales were up:  There were 10% more homes sold in 2020 than in 2019.

This is what you call a sellers market or an unbalanced market.  The proof of that can be seen in the data.  

  • Sales prices are up 7.5% year over year (great for sellers)
  • Market Time is down from 25 days to 15 days (great for sellers)
  • Sales price to list price is just below the 100% mark (great for sellers)

That is what you call a sellers market.  Lack of inventory and strong buyer demand is causing homes to sell quicker and for more money.  

Why is the demand so high? 

Interest rates are the main reason.  Interest rates continue to sit in the 3% range.  This provides buyers with more buying power along with the fact that renting a home or apartment is often times more expensive.  

What do we need to see for the market to be more balanced? 

We need one of two things to happen.  Interest rate increases would take some of the buyers out of the market to buy a home.  Increase in supply would give the buyers what they are looking for.... Homes to buy.

What do we see happening next year?  

I think that demand will remain strong with interest rates not forecasted to go up by much if at all.  I also think that with the shift to telecommuting, we will see more families decide it is time to get a bigger home to accommodate home offices and home schooling.  We desperately need more homes on the market to meet this demand. 

So how can the Ziemers help in this unbalanced market?

The fear for many of these sellers is that they will end up homeless if they sell because there isn't anything to buy.  That is where we come in.  We batted a 1000 this year helping clients navigate a sale and purchase in a very challenging market.  We have strategies in place to find homes that haven't been listed yet.  We can do the same for you.  If you want to make a move, don't let the market scare you.  We can help.

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