The Real Estate Market May be Cooling, but Only Slightly
Exploring the continuation of the seller’s market.
During the summer of 2020, after the start of the pandemic, the housing market escalated with swift sales and soaring prices as people realized they wanted a change of scenery, more space or both. This summer, the market continued to break the mold and showcase trends unlike anything we’ve seen before, with consistently low inventory and interest rates, yet sky high demand. As autumn begins, we reflect on what buyers and sellers can expect in the coming season.
If you’re worried you missed the sellers’ boat, don’t worry. Tim Ellis of Redfin Media says, “The market frenzy of 2021 has cooled somewhat, but home sellers are still very much in the driver’s seat in the housing market today.” We can see this in our continued rising prices. From this time last year, the median sales price has increased by 16%. What does this mean for buyers and sellers this season?
Supply is steadily increasing, but it’s still low. New active listings are up 8% from their lowest point in March of this year, but the overall supply is still down 32% of what it was a year ago, according to Redfin Chief Economist Daryl Fairweather.
Many sellers are looking to take advantage of the hot market, in fear of missing out on these historically high prices. This is one of the primary driving factors of the increase in supply. Ironically, sellers’ enthusiasm to take advantage of the hot market could be contributing to the cooldown. However, it is unlikely this represents a large enough group to shift the market long term.
Buyer demand remains strong and steady. Homes remained on the market for an average of 18 days. This is down from the all-time low of 15 days we saw in June and July, but it is still far lower than the 34 days we saw a year prior. A lot of this change is seasonal, and some of it is buyer fatigue, but demand overall remains historically high.
Daryl Fairweather states that "Demand for homes is making a comeback because even though home prices are high and competition is still steep, homebuyers don't have many alternatives but to keep trying." Combine this with low mortgage rates, and demand will likely continue to be historically high.
Seasonal shifts may be less pronounced this year. Typically, we see the housing market cool in the fall as families prepare to send their kids to school and hunker down for the winter. However, the pandemic may have thrown this pattern off balance.
Senior Economist George Ratiu says he “expects an unusually busy fall season” this year. More people are vaccinated and feel comfortable going out into the world again. This means more open houses, more attendees, and more activity in general. “Sellers are putting homes on the market,” says Ratiu. “Normally this activity happens early in the spring.”
What does this all mean for you? While the market may be cooling, experts all agree: we’re still in a seller’s market.
If you’ve considered selling your home, you can still take advantage of the market. I encourage you to instantly calculate your home’s value in today’s market based on recent Charlotte County sales at www.helgemoteam.com.
If you have any questions about our market or are thinking about buying or selling, don’t hesitate to give us a call at (941) 205 8478 or email us at [email protected]. With so many unprecedented shifts in the market, our experienced agents can offer buyers and sellers not only the best offense but also defense. We are here to help you navigate all the opportunities available to you.
The Helgemo Team at Compass Florida