According to recent statistics released by the National Association of Realtors (NAR), sales of existing homes in July rocketed up 24.7% from June, the strongest monthly gain in the history of their survey going back to 1968, and the highest sales pace since the housing boom in 2006. Gains year over year in July 2020 were 8.7% higher than in July 2019.
NAR’s economic staff reports that median home prices in the week ending August 15 were up nationally 10.1% year over year, and when adjusted for inflation that is “higher than the bubble high set in 2006.”
Regionally, the NAR numbers are even more impressive. In the Rust Belt, the Midwest, Southern metro areas, and even high-priced California, prices have risen more than 20% in the last year. Realtor.com’s Clare Trapasso attributes the price rise to extremely limited supply, and as winter chills certain parts of the country price growth could slow, or even fall slightly. “That could happen if prices rise so high that homeownership becomes too expensive for the majority of would-be buyers. So instead of a bubble popping, it’s more that home prices could come back to reality.”
According to our regional MLS system, August numbers for the Baltimore metro continued on an upward trend, with the average median price rising for a third straight month, up 12.4%, to a ten year high of just under $326k. Days on market fell to an average of just 10 days, a new low, and the number of units that left the market in ten days or less nearly doubled over last month. Part of this rise in sales price reflects that new listings of single-family homes fell nearly 10% to an August five-year low.
Some Baltimore-area neighborhoods are lagging behind in price appreciation and have more inventory, so contact me if you want to know the exact situation in your chosen area.
Nationally, big cities hit hard by the COVID epidemic are seeing prices flatten or even fall. As businesses allowed their employees to flee to suburban home offices for the duration of the pandemic, remote work has emptied office towers. This is especially true in the New York metro area. Brokers are hopeful that this trend is in the process of reversing itself, according to Brian Lewis, Associate Broker for Compass real estate brokerage in Manhattan. “Right now our prices are lower — sure; but our buyer demand is growing daily and the Big Return to Gotham has begun… the energy of NYC — and the talent that she attracts — are still unrivaled,” he writes.
Others are not as optimistic. The Washington Post recently released the results of a survey of mid-Atlantic business owners that show that by summer of 2021 only 72% of employers feel sure that their offices will be fully open and ready to receive commuters. Working from home appears to be here to stay for a large percentage of residents of our region.
So, if you’re not convinced that your current home is adequate for another year of serving as workplace and family space, give me a call. Mortgage rates continue at historically low levels, and there’s never been a better time to sell your existing home.