COVID-19 Is Pushing Home Buyers to Move Sooner

Sometimes you need a little push to get things going, especially when it’s a big something like purchasing a home.

Well, it turns out a pandemic can be that driving force, as evidenced by a new survey from real estate brokerage company Redfin.

The company said 25% of the 1,000 home buyers it polled are moving (or moving sooner than planned) due to COVID-19.

COVID-19 Induced Low Mortgage Rates Are Getting Buyers Off the Fence

changing plans

In terms of what’s getting people moving, literally, it’s the record low mortgage rates currently on offer.

Thanks in part to COVID-19, mortgage rates have hit new record lows eight different times this year (so far and it’s only August), as economic uncertainty often has a positive effect on interest rates.

Some 55% of respondents cited the “low mortgage rates” as reason to change or speed up their plans.

The second biggest factor (52%) was “spending more time at home,” something I think we’ve all done a lot of lately.

When you’re home all the time, you have more time to think, and more time to complain about your surroundings too.

Third was the work from home angle (40%), which is changing living preferences for prospective home buyers.

It tends to mean buying more house so a home office can be designated in one of the bedrooms.

It also means moving out of the city to the more spacious and affordable suburbs.

Home Buyer Preferences Aren’t What They Used to Be

home buyer preferences

While 25% of respondents said COVID-19 hasn’t changed their plans or preferences, a home office and outdoor space are now at the top of the list for many prospective home buyers.

Additionally, there’s a desire for a bigger yard, a pool and/or hot tub, a designated learning space for children, and a bigger home in general.

In other words, a lot of today’s home buyers expect to be holed up in their properties for a while, and are planning accordingly.

Others said they delayed their plans to move, or want a less expensive home, perhaps due to uncertainty regarding income or employment.

Still, despite a surge in unemployment and a very shaky economy, real estate appears to be firing on all cylinders.

Per Redfin, pending home sales were up 12% year-over-year during the four weeks ending July 26th, while the median sale price was up 11%, the largest increase since 2014.

Additionally, more than half of Redfin offers involved a bidding war for the third consecutive month in July.

Anecdotally, I know of two families offhand that have sold or are in the process of selling their homes during the pandemic.

Interestingly, both families had lived in their homes for many years and thought of them as forever-homes. Amazing what a pandemic will do, eh?

One is upgrading to a larger home to account for the wife now working from home.

And the other is moving out of the city and into the suburbs, both for more space and to get out of the less-desirable urban center, something they thought they’d never do.

It’s basically an about-face from the trend we saw before COVID-19 hit – everyone and their mother (literally) wanted to live in a city center, walk to bars and restaurants, live with less space, etc.

That’s all changed very quickly, as folks realize it’s nice to have some breathing room when you spend most, if not all, of your time in one place.

Both homes went pending in about a week, at high asking prices, which tells you how much demand there is right now for residential real estate.

Whether it will last remains to be seen, but at the moment it seems to be all systems go.

About the Author: Colin Robertson

Before creating this blog, Colin worked as an account executive for a wholesale mortgage lender in Los Angeles. He has been writing passionately about mortgages for nearly 15 years.

Source: thetruthaboutmortgage.com

Homie’s Utah Housing Market Update January 2021

The Utah real estate market continues to see new peaks and valleys. Here’s your monthly update on what’s happening.

Data from Utah MLS from January 1, 2021 to January 31, 2021.

Sale Price

In January, Utah real estate prices leveled out from their previous upward trend. Median home prices settled at $380K, down $4K or 1% from December. The annual trend, however, shows a stark contrast. Median home prices rose $55K, or 16.9% from the previous January. The 2020-21 trendline has been mirroring the 2019-20 trendline for several months, albeit at a higher level.

UT Median Sale Price Jan 21

Data from Utah MLS

Days on Market (DOM)

When it comes to days on the market, the Utah market has stayed steady. For the fourth month in a row, the average home spent nine days on the Utah market. That’s a full 30 day difference from January 2020, a 76.9% year-over-year decrease. Homebuyers may feel the heat of competition for fast-moving homes in this seller’s market.

UT DOM Jan 21

Data from Utah MLS

Inventory

Inventory has fallen to new lows. Only 2,383 active listings were on the Utah market in January, compared to 2,920 available units in December. The month-over-month decrease was an on-trend 18.4%. Annually, the market saw a rather steep drop from 6,811 active listings in January 2020. That’s a year-over-year inventory decrease of 65%. With that level of scarcity, it’s no wonder that Utah homes are selling so quickly.

UT Inventory Jan 21

Data from Utah MLS

Monthly Sales

January saw a sharp decline in monthly sales from December, down by 1,528 units or 35.3%, following the seasonal trend. Monthly sales have followed the seasonal pattern, down one tenth of a percent from November 2020. A mere six fewer homes were sold in December than in the previous month. Observing the annual trend, home sales came up just slightly from the previous January. Only 90 more homes sold in January 2021 than January 2020, an increase of 3.3%. It is likely that market seasonality is largely responsible for the dip. However, the low level of inventory may be affecting the number of homes sold as well.

UT Monthly Sales Jan 21

Data from Utah MLS

Turn to a Homie

Homie has local real estate agents in all of our service areas, including Utah. These agents are pros in everything they do, including understanding the local real estate market, so they can help you regardless of market conditions. Click to start selling or buying and to get in touch with your dedicated agent.

Source: homie.com

Homie’s Greater Phoenix, AZ Housing Market Update January 2021

Phoenix January 2021 Market Report

2021 is already starting off strong for the Arizona housing market. Check out the January happenings!

Monthly Sales

According to data from the ARMLS ® from January 1, 2021 to January 31, 2021, the Phoenix metro area had 7,076 monthly sales, an +11.8% year-over-year increase, landing at 7,076. This number is a 26.8% drop from the previous month’s sales, however.

Monthly Sales

Data From ARMLS®

List Price

With a +10.8% increase from January of 2020, the average list price in Phoenix this January was $471.4K. Median prices also rose in January, landing at $347.7K, a +12.2% increase from December.

New List Prices

Data From ARMLS®

Sale Price

Sale prices continue to rise faster and faster. With an increase of +20.6% between January 2020 and January 2021, the average list price this month was $439.6K. Median sale prices also rose with +17.3% year-over-year increase. The January median sale price was $340.0K. This increase is 3% larger than the previous month’s increase in median sale price. Both median and average sale prices are expected to rise again in February.

Sales Prices

Data From ARMLS®

Days on Market (DOM)

The Average Cumulative Days on Market in January was 46. This is a three-day increase from the previous month, however, it’s an 18-day decrease from January 2020, showing the market is still quite hot, especially for this time of year.

Average Days on Market

Data From ARMLS®

A Message From Wayne Graham, Head of Real Estate

All indications point to the Phoenix market continuing to be strong in 2021. We have a strong start to the year coming off a record year in 2020. The demand for homes is high as interest rates are still low so we expect homes to continue to sell quickly. Now is the time to jump into the Phoenix market and take advantage of record sales and high demand.

Want to Know Your Home’s Value?

Are you thinking of selling soon? Are you wondering how these market trends affect your home? We can help you determine your home’s value. Click here to request your free home value report prepared by a Homie pro.

Turn to a Homie

Whether you’re buying or selling, our team of experienced professionals will help you make the most of your real estate experience. Click to start selling or buying with your dedicated Homie agent.

Source: homie.com

Homie’s Arizona Housing Market Update September 2020

The real estate market in the greater Phoenix metro area is booming. Prices continue to rise and homes continue to sell faster and faster. Here’s your monthly update on what’s happening.

Monthly Sales

According to data from the ARMLS® from September 1, 2020 to September 30, 2020 the Phoenix metro area saw 9,305 total sales in the month of September. This is a +4.8% from the previous month. Looking at the year-over-year comparison, the jump is even higher. September 2020’s monthly sales are +18.5% higher than monthly sales in September 2019.

chart showing monthly sales for 2020 at 9305 vs 7850 in 2019.

Data via ARMLS® September 2020.

List Price

September list prices saw a +11.1% year-over-year increase, landing at $458.8K. At 335K, an +11.7% increase from September 2019, median list prices are also high.

Chart showing list price for 2020 at 458.

Data via ARMLS® September 2020.

Sale Price

At $410.9K, sale prices are rising. This is a +23.1% increase from last September and a +3% increase from August of this year. At $329K, median sale prices also rose with +17.5% increase from September 2019.

Both the average and median sale prices are rising quicker and quicker. September’s +23.1% year-over-year increase in average sale price is a jump up from August’s +17.7% year-over-year comparison. Before that, July’s increase was +14.6%, while June only had a year-over-year increase of +1.4%. The median sale price is following a similar upward trend. If you’re looking to invest in a home in this market, buying sooner may be better than later.

sales price chart comparing 2020 average at 410.9k vs 329k in 2019

Data via ARMLS® September 2020.

Days on Market (DOM)

The Average Cumulative Days on Market continues to drop. Homes are selling faster and faster every month. The average DOM for September 2020 was 46, which is a 5-day decrease from August 2020 and a 13-day decrease from September 2019.

Average days on market 2020 46 vs. 59 in 2019.

Data via ARMLS® September 2020.

A Message From Sales and Operations Manager, Wayne Graham

There is no doubt about it, the Phoenix market is not slowing down. After another record-setting month of September and October is already shaping up to do the same. Despite our depressed economy due to Covid-19, the Phoenix real estate market will continue to surpass all expectations for 2020.

Want to Know Your Home’s Value?

Are you thinking about taking advantage of how hot the market is by selling your home? Click here to get your free home value report.

Turn to a Homie

Homie has local real estate agents with years of experience and an unrivaled knowledge of the local Arizona market. Click to start selling or buying with your dedicated Homie agent.

All data retrieved from ARMLS®.

Source: homie.com

Homie’s Utah Housing Market Update October 2020

The real estate market fluctuates often. The local Utah market isn’t an exception! Here’s your monthly update on what’s happening.

Data from Utah MLS from October 1, 2020 to October 31, 2020.

Monthly Sales

According to data from the Utah MLS from October 1, 2020 to October 31, 2020 monthly sales in Utah are rising. At 5,602, there were 417 more monthly sales in October of this year than in September. This is a +15.4% increase from October 2019.

graph showing 5,602 monthly sales in Oct. 2020 compared to 4,213 in Oct. 2019

Data via Utah MLS.

List Price

It’s not just inventory that’s rising, but list prices are rising in Utah, as well. October’s median list price was $369K, a +12% year-over-year increase.

data bubble showing 369k as the median list price in Oct. 2020, 12% increase year over year

Data via Utah MLS.

Sale Price

At $370K, Utah’s sale median sale prices are sitting slightly higher than the median list price. This number is $50K, or +15.6%, higher than sale prices in October 2019.

graph showing median sale price at 370k in Oct. 2020 compared to 322k in Oct. 2019

Data via Utah MLS.

Days on Market (DOM)

Homes in Utah are flying off the market faster and faster all the time. October’s average number of Days on the Market was 9. The previous month’s average DOM was 11, while October of 2019 had an average of 29. This is a whopping -69% decrease. If you’re looking to buy a house, you’ll need to move faster than before.

graph showing average days on market in Oct. 2020 as 9 compared to Oct. 2019 at 28

Data via Utah MLS.

Number of Homes Listed With Homie

A total of 231 homies listed their homes with Homie during the month of October.

Stat showing 231 homes listed by Homie in Oct. 2020

Data via Homie Real Estate.

Turn to a Homie

Homie has local real estate agents in all of our service areas, including throughout Utah. These agents are pros in everything they do, and understanding the local real estate market is their passion. Click to start selling or buying and to get in touch with your dedicated agent.

Source: homie.com

Greater Phoenix, AZ Housing Market Update October 2020

If you’ve kept an eye on the housing market in Arizona for the past year, you know it’s been trending hotter and hotter. October stuck with that trend. Homes are selling quickly and for higher prices. Check out the stats below.

Monthly Sales

According to data from the ARMLS® from October 1, 2020 to October 31, 2020, monthly sales in the Phoenix metro area rose +4.1% from where they were in September of this year. At 9,690, total monthly sales are a full +23.5% higher than sales during the same time period in 2019.

Data retrieved from ARMLS®.

List Price

At $457.7K, October saw a +6.9% year-over-year increase in average list price. Median prices also rose. With a +12.3% increase from October 2019, the median list price in October was $337K.

Data retrieved from ARMLS®.

Sale Price

Average sale prices increased by +23.2% in October 2020 compared to October 2019, landing at $425.3K. With a slightly smaller jump, median sale prices still rose significantly with +16.7% year-over-year increase. The October median sale price was $332.5K. November is forecasted to have a slight decrease in average sale prices, which would break the trend of steadily rising prices. Check back next month to check if the forecasts were correct.

Data retrieved from ARMLS®.

Days on Market (DOM)

The Average Cumulative Days on Market dropped by three days between September and October of this year, ending at 43. That’s a 16-day decrease from October 2019.
<img src=”https://www.homie.com/blog/wp-content/uploads/3-1.png” alt=”Data retrieved from ARMLS®.” width=”1060″ height=”510″ class=”aligncenter size-full wp-image-32344″ />

Want to Know Your Home’s Value?

With homes selling quickly in the Phoenix metro area, if you’re looking to sell, we can help you find out how much your home is worth. Click here to request your free home value report from a Homie pro!

A Message From Sales and Operations Manager, Wayne Graham

The Arizona Regional MLS (ARMLS®) has already declared 2020 to be our best year ever. Now is the time to reach out to Homie and let our expert agents help you sell your home.

Turn to a Homie

Homie has agents with significant local expertise in each of our service areas. These agents are knowledgeable and easy to work with. Click to start selling or buying with a dedicated and experienced Homie agent.

Source: homie.com

Existing home sales are still too hot

The National Association of Realtors reported that existing home sales for January were at 6,669,000, which beat estimates. The year-over-year growth was an impressive 23.7%. The median sales price also jumped 14.1% year over year, which I warned could happen during the years 2020-2024. On a recent HousingWire podcast, I discussed the need for higher mortgage rates to cool down this growth rate.

Currently, the 10-year yield is 1.35%, which is now above a critical level that I have talked about for some time. We should all be jumping for joy as the bond market shows the American bears that America is back. Mortgage rates should also creep higher. When the 10-year yield gets into the range of  1.33%-1.60%, we will have achieved our goal for the “America is Back”  economic model that I proposed last year, which I believe could only happen in 2021.

With the yield in that range, we can expect the mortgage rate to move up toward 3.375%. We still have a lot of work to do to earn the right to create this range in the bond market; the first would be hitting 1.60%, which we haven’t yet. The chart below shows the 10-year yield as of the close of Thursday. Today, bonds are selling off and yields are higher.

Mortgage rates are still meager, historically speaking, but 3.375% or higher may be enough to slow the home price growth rate – which, right now, is simply too hot. The days on the market went from 43 days last year to 21 days currently.

So far this year, the MBA purchase application data is running stronger than even I thought. This metric is a predictor trend of demand 30-90 days out. I believed the peak rate of growth in purchase applications would be around  11% year over year up until March 18th. It is trending at 13.1% this year, so we are off to a good start for 2021.

New home sales, existing home sales, and the builder’s confidence index that went parabolic towards the end of 2020 have stopped going up and started to fall.  The last report on new home sales shows that housing data moderates and moves back to the trend.

The monthly sales prints for existing home sales show that this metric has stopped its parabolic move higher, but it still has not moderated enough. We still have not  completely made up for the lost sales in 2020 due to COVID-19.  We should have ended 2020 with 5,710,000 -5,840,000 in existing home sales but only realized 5,640,000.  This number is only 130,000 higher than what we had in 2017, so this isn’t the booming speculative buying we saw during the height of the housing bubble years.

Once this makeup demand is exhausted, existing-home sales should moderate toward 6.2 million or even lower to get back to the trend. If existing home sales stay above 6.2 million on the monthly sales print for the entire year, we can consider the demand to be even better than expected.

For the rest of the year, the single most important and healthy event for the housing market would be higher mortgage rates to cool down home prices’ growth rate. We will see if mortgage rates rise high enough to cool demand and reduce the multiple bid situation we currently have in many markets.

Nobody wins when the housing market is too hot – not even sellers because they will need to find somewhere else to live. We have enough supply to grow sales to pre-cycle highs, but when choices are limited, the willingness to sell and move becomes less attractive.

Source: housingwire.com