You may remember what I wrote about a few weeks back: the belief that people are fleeing big cities during COVID and moving elsewhere. While we determined that specific claim was a little bit exaggerated, the pandemic still definitely has an impact on real estate.
One interesting thing I read was that there are actually way more people in the U.S. looking to BUY a new home than there are owners looking to SELL right now. That has led to low inventories across many cities and suburbs. Overall, the tight market is more being driven by low mortgage rates and that COVID migration.
The Wall Street Journal says all of this, plus that Americans are holding on to their homes longer than usual, which is costing would-be homebuyers. This all contributes to the low inventories and record-low sales (which, in turn, helps contribute to high prices). According to Redfin, the typical homeowner had remained in place for 13 years, up from 12.8 years in 2019, and way ahead of 2010’s 8.7 years.
One factor to consider, too, is that with so many people now working remotely, many home buyers are in the market for more space. If their home is going to double as a workspace now, it makes sense to look for a larger home. With that though, potential sellers are being scared off by the day-to-day of having strangers enter their homes during a pandemic. All of this adds up to a crazy COVID market!
I recently put an offer in for a client listed at $1,075,000 in San Ramon. There were 19 offers, the seller gravitated to offers that removed all their contingencies. The home (4 beds, 2 baths, 1447 sq. ft.) had been renovated prior to going on the market is pending at $1,310,000 and it appraised! Hopefully we start to see more equilibrium between a sellers and buyers market, but for now, hold on, it is a wild ride for buyers, but great for sellers.