While demand for homes stays high and the pandemic plays with the people’s psyches, supply stays low. That bottleneck is triggering bidding wars, especially in cities like Boston and San Francisco.
TL;DR:
- Home prices are rising (+14%)
- Housing supply is the lowest on record (since 1982)
- Bidding wars are prevalent among the few available listings (click)
- Homes are selling almost twice as fast as last year (Average DoM down to 21 days)
- Sales are about 2% lower than October, but almost 25% higher than last year
- Houses around $1M are selling at nearly double their average rate
The decline we see is potentially a result of those bidding wars inflating home prices. That, and the government’s feeble attempts at solving coronavirus have killed many small businesses and therefore job opportunities— lowering spending power. That, coupled with a 14% increase in home sale prices, is far from ideal for buyers with the exception of 0% interest rates.
We saw 1.28M homes for sale by November 30, which is 22% lower than the prior year, and the lowest inventory since NAR began tracking it in 1982.
Even with new listings up ~10% YoY, it’s yet to fill the demand.
After five months of upswing, sales of existing homes were lower in November due to lower supply, but buyer's and sellers are active as ever. They lowered 2.5% month-to-month to a seasonally adjusted yearly rate; 6.69 million units. HOWEVER, Sales were 25.8% higher year-over-year, which means although sales lowered between October, they're astronomically higher YoY than what data predicted.
The days on market for homes is setting records as well, averaging 21 days on the market, which is 17 days less than the year prior.
The growing imbalance between supply and demand has home prices rising faster than we might hope for a healthy market. The median price of existing homes rose 14.6% from November '19.
Home Prices and YoY Sales:
