I guess I shouldn’t be surprised. I’ve been preaching for a few weeks that Buyers are still out there. All we’ve done with Covid is weed out the Real Estate tire-kickers!
But it brings me great J*O*Y to see this is still the case about a month into our Stay-Home orders. My business partner and I have been listing homes For Sale and they’re still going under contract within DAYS. (which is due in large part to our marketing strategy. Williamson County’s average Days on Market is more than a month).
Take this home pictured, for example. It only stayed on the market 10 days before getting multiple offers. We currently have it under contract at it’s full asking price. And many of the indicators suggest this not an anomaly.
Why Am I Telling You This?
In times of extreme uncertainty like what we’re facing now, it’s easy to lose sight of what the Real Estate environment actually looks like. Worry and fear get in our way of making logical decisions based on fact.
I’ve heard so many people make comments about our current crisis resembling the Market crash of the early 2000s, when the bubble popped on Real Estate across the country. Some buyers are waiting on the sidelines for their moment to pounce the minute that happens again. But I don’t think it will. Not this time.
The more Buyers wait, the more prices will continue to increase, for the foreseeable future anyway.
Real Estate information distributor, KeepingCurrentMatters, explains one huge difference between then and now, saying inventory (the amount of homes For Sale) was extremely high nationwide going into 2007 and 2008, with almost a year’s worth of inventory at the worst of 2008.
You can see the 11-month inventory mark represented at the peak of 2008 on this graph, making it a solid Buyers Market. This means it was taking a home on the market about 11-months to sell, because there were more Sellers than Buyers. Taking a look at the graph, you can also see there is less than 3-months inventory nationwide today, which puts it deep into a Sellers Market. There are way more Buyers out there now than there are homes For Sale. For perspective, when there is 6-7 months of inventory, Buyers and Sellers are on an even playing field. That’s actually considered a healthy market.
Here in Grassland, our latest inventory level hovers even lower than the national average. We are right around 38 days – so just over a month of supply. Our LOOOOOOOW level of inventory here is key.
This is important information for those who think we’re headed for another Real Estate crash. Though high inventory wasn’t the only thing that led to the crash in 2007-2008, it was one of the biggest players.
According to KCM, the current low inventory, like here in Grassland, “shows just how different the market looks today AND that we’re in a great position to bounce back once this passes and business resumes.”
As I’ve mentioned in previous blog posts, Real Estate is often what brings our economy back after these hiccups.
And if China’s Real Estate market is any indication, we could bounce back here, with continued strength in our Real Estate market as soon as Stay-Home orders are lifted. Real Estate industry information distributor Inman News reports China has seen Real Estate activity come back stronger — to higher-than-pre-pandemic averages since their lockdowns were lifted.
More to This Recipe
Interest rates are also a key player here as they continue to fall, hovering near all-time lows. Inman says, “the average rate was reported at 3.33 percent, down from 4.12 percent at this time last year.”
Brentwood Lender George Margrave echoes these comments adding, the rate drop “reflects improvements in market liquidity and sentiment.”
And when interest rates are low, that drives up the prices of homes on the market. “We’re still seeing a 2.5% growth in home prices year-over-year,” according to Margrave.
In my next blog post, I’ll hash out Grassland’s exact numbers from March — and how we’re comparing year-to-year for movement in our market. I’ll also keep hammering away here, doing my part to keep our market moving Covid-style.. mostly from the comfort of my keyboard.
If you need to sell your home and want honest advice on what it takes during these unprecedented times, I’ve got you. Call, email or text me. I provide a free consultation to see what your home could sell for – or to get pre-approved to buy. ALL DONE VIRTUALLY! I’m a Grassland area resident, I’m a Platinum Award-winning Williamson County REALTOR® ranking in the top 2% and I specialize in helping my neighbors buy and sell homes!