Real Estate In the Time of Covid: It's still happening: March 2021 hits an all time high for monthly sales!
Home buyers continued to buy homes at unprecedented rates last month. We saw the highest recorded monthly sales in history, despite daily media reports of impending market collapse.
In 2008, after a crazy flurry of activity similar to what we are seeing now, the media reports killed the market. Over the past few weeks, the number of media reports on the "overinflated", "bubble", "artificially high" (choose your favourite adjective) housing market, have been appearing at a frequency that I have never seen before. Usually, this type of coverage causes buyers to pause and rethink jumping into multiple offer situations, paying high, and making no subject offers. To date that hesitation hasn't happened.
There are many things that could kill this market; negative news stories are just one. Since the press doesn't seem to be having an impact (yet) I think the next most likely thing to slow the market will be a shift in the supply/demand equation. Right now we still have a lot of buyers and not a lot of homes for sale. Having said that, in the past couple of weeks, in several neighbourhoods, we have seen listing levels that had been at 0-1 new listings per week, jump to 3 new listings in a week. This gives buyers 3 times the choice and sellers 1/3 the number of potential buyers fighting to buy their home. It looks like more and more sellers are listing, or planning to list, over the coming weeks. As this happens, not only does the supply increase shift the market dynamic, the number of potential buyers decreases as more buyers are able to actually purchase. Real estate, like any other sales situation, is all about supply and demand. When there is more supply, the market is better for buyers; less supply is better for sellers. Things will shift; it is just a matter of when that happens.
Last month remained strong and for March 2021 we saw:
-sales of all types of homes were up a whopping 126.1% over March 2020. This is due in part to the fact that the real estate market came to a grinding halt, due to Covid, mid way through March 2020
-sales of detached homes were up 130.6% over March 2020 (again, March 2020 was very good for 2 weeks and almost completely shut down for 2 weeks so sales were a bit low last year)
-sales were up 53.2% over February 2021 (this is crazy given how well sellers did in February)
-sales were up 72.2% over the 10 year average for March (again this is crazy and amazingly good for sellers)
-the benchmark price for detached homes was up 4.9% over February 2021; for all types of homes it was up 3.6% over February 2021
Obviously, most sellers are doing very well when they sell...but I think time may be running out. Timing is EVERYTHING in real estate....and the best time to sell is when supply is low and demand is high...add to that unbelievably low interest rates and sellers are winning the real estate lottery.
If you have been thinking of selling your home or if you would like to discuss the current market (or anticipated future market) and how it may affect you, please let me know.