Winter is traditionally real estate’s slow season. Between the cold weather and the holidays, the housing market typically plunges into a hibernation of sorts, with both buyers and sellers shelving any major real estate moves until spring.
This winter’s real estate market, however, is shaping up to be unlike any other before it—and, contrary to what some may have feared, is slated to be an excellent time to sell a home. In fact, Lawrence Yun, chief economist at the National Association of Realtors, predicts “it will be one of the best winter sales years ever.”
Why? Chalk it up to a perfect storm of low mortgage interest rates, sparse housing inventory, plus a pandemic that’s fundamentally changed how, when, and where buyers are shopping for homes.
So if you’ve assumed you should put your home-selling plans on hold until spring, read on for a surprising reality check on all the reasons this winter could be a great time to put your house on the market.
Pandemic lockdowns have created pent-up buyer demand
While spring is typically real estate’s busy season, the “silent spring” of 2020 saw the housing market grind to a near halt amid pandemic-mandated lockdowns. This, in turn, created pent-up demand to purchase property that is only now being unleashed.
Lockdowns are forcing many buyers to upsize their homes
COVID-19 has not only created pent-up demand, but many buyers are also in the market purely because they’re working/schooling from home and realizing their space is no longer big enough—particularly now that the temperature’s dropping so they can’t easily escape to their back patio to catch up on emails alone.
Housing inventory is low
Although buyers are plentiful, the number of homes for sale is way lowerthan usual. According to realtor.com’s Monthly Housing Market Trends Report, in September, national housing inventory declined 39% over last year.
Sellers can get top dollar for their homes
It’s simple supply and demand: Low supply and high demand are bound to drive up home prices, so sellers stand to make a killing.
Across the country, median home listing prices jumped 11.1% in September compared with a year ago, to $350,000, according to realtor.com. Price per square foot increased by 13.9%.
“Sales prices and home values remain strong,” McDaniels says. And since there are so many offers on the table, “sellers can call the shots regarding terms of contract and repairs.”
Mortgage interest rates are low
Although buyers will face stiff competition, it’s not all bad news for them. For one, despite high home prices, record-low interest rates mean they’ll save a ton of money.
Interest rates on a 30-year fixed-rate loan were 2.8% as of Oct. 22, according to Freddie Mac.
Any economic shift likely won’t be felt until spring
Although unemployment continues to rise due to COVID-19 layoffs, Hale says this could affect the real estate market, but the effects likely won’t be felt for a few months.
| Nov 2, 2020