Just like so many parts of life, the real estate market was greatly impacted by the Covid-19 pandemic. From mass unemployment and reduced listings to high demand for houses in contrast to low inventory, the real estate market is much different than it was two years ago.
With high housing prices, low interest rates, fluctuating mortgage rates, and financial strain on homeowners, the current market is bound to make anyone’s head spin.
In the spring of 2020, house sales were lower than many had seen in over a decade. Fewer people were trying to sell their homes, and many homeowners pulled their listings due to the uncertainty that came with trying to sell in the middle of a pandemic. Initially, the low inventory of houses was not a major issue, as it was matched by lower demand.
Low inventory became troublesome as demand grew, as there were (and still are) significantly fewer homes on the market compared to pre-pandemic times.
Since inventory and demand for houses were relatively well-matched in the beginning months of the pandemic, housing prices didn’t drastically rise or drop. As mentioned above, this didn’t last for long, and the demand soon grew at a much faster rate than the number of homes for sale.
During the summer of 2020 and beyond, demand actually rose to above pre-pandemic levels, and the inventory of houses stayed about the same. This caused housing prices to steadily rise, and the average asking price on new listings is now undeniably higher than we would have seen pre-pandemic.
Though listing prices are higher, many home buyers are receiving lower mortgage and interest rates than they might have received before the pandemic. With many homeowners unemployed and unable to keep up on mortgage payments, mortgage forbearance programs (pausing or reducing your mortgage payments) and moratoriums on foreclosure proceedings have been put in place to keep foreclosure rates low.
As these programs come to an end, inventory may grow as a result of foreclosures and increased listings from people that decide they can no longer afford their house. This is another factor that will affect the constantly changing mortgage rates.
New Home Construction
As the inventory of existing houses remains low, new construction will become a more popular option for prospective home buyers that have the means to make it happen. Additionally, interest in new home construction may steadily increase as families rethink exactly what they want out of a house after spending so much time inside during the pandemic.
Unfortunately, new construction projects may run into delays as covid-19 slows down many processes including getting permits, conducting inspections and appraisals, and the construction itself.
Trends in the Stanwood Camano Area
Our local market continues to change regularly. The Stanwood and Camano area is unique and you cannot always depend on larger market reports to reflect our local trends. To help both buyers and sellers navigate those changes we prepare a monthly, in-depth report into the trends of our local market. This report includes key statistics, like listings sold by price point or the number of days on the market, and empowers our agents and our clients with the most up-to-date and relevant information.
So, is it the right time to buy? Buying a home can be overwhelming at the best of times, and Covid-19 certainly makes things more complicated, but that doesn’t mean it’s not feasible. The bottom line: It’s the right time to buy if you’re ready for it!