Hello, and happy new decade to all! I hope this month’s market update finds you well, and well-rested, after making it through another crazy holiday season.
New Decade resolutions feel like biting off more than anyone can chew. I know I’m not that ambitious. I can’t even stick to a year-long resolution. But maybe you can. Certainly you have some new goals for the new year (or maybe you’re revisiting some of your old ones that fell by the wayside…either way). If you’re goals for the year have anything to do with real estate, then this market update is definitely for you.
We began January with just over 5,000 homes available for purchase in our market.
This is the lowest number we’ve seen in two years, and represents a nearly 30% decline in active inventory from a month ago and a near 50% decline in active inventory from 2019’s peak of 9,520 active listings in June. So, what’s driving this larger-than-usual decline in inventory, and what does it mean?
The first explanation is the holidays. We always see a seasonal decline in inventory, and in 2019, Thanksgiving, Christmas, and New Years were packed very tightly with only three weeks taking place between Thanksgiving and Christmas.
Further, interest rates are the lowest they’ve been in two years and are a full point below where they were at this point last year, which puts a significantly greater amount of buying power at a buyer’s disposal. So there’s the “why.”
As for what it means, it means that if you’re a buyer and you’re out actively looking (which you should be), you need brace yourself for some tough negotiations, and some heartbreak.
Every January, we see big spikes (between 30-50%) in showing activity. We’d already seen showing activity jump this year from October to November, and now we’re bracing for another big jump this month. It’s going to be competitive; we’ll see multiple offers, bidding wars, fewer days on market, and homes selling for over asking price. So find the house you want, and be ready to dig in to get it. Once you do, the payoff will come quickly as what’s shaping up to be a crazy January and February (and beyond) will result in quick increases in your new property’s value. Immediate equity in your hands.
Sellers, there hasn’t been a better time to sell in at least a year.
Inventory is low, and buyer activity is very high. Now through March are going to be the best times to take advantage of our current market. Enough said, there.
Someone out there wants and needs your house.
Those whispers we were hearing over the summer of our market having shifted power back to the buyer seem like a long, long time ago, and in a galaxy far, far, away. Remember to always check in with an expert whenever you see a headline that makes you want to click.
As always, feel free to reach out with any questions you might have, or if you’d like to do a deeper dive into our crazy market. Until next month. Happy New Year!