If you’ve decided to wait until the pandemic settles down before selling your home, you might be surprised to learn that contract activity for home purchases is at a higher level than a year ago.
The latest data shows home prices and buyer demand through the roof. Pending home sales continued to soar through August, marking four consecutive months of increases, according to the National Association of Realtors. September pending sales data is due Oct. 30.
The NAR Pending Home Sales Index (PHSI), a forward-looking indicator of home sales, rose 8.8% to 132.8- a record high – in August. Year-over-year, contract signings have risen 24.2%.
In short, if you’ve been sitting on the sidelines, it might be time to get in the game. All four regional indices recorded increases, led by the West at 13.1%.
After the coronavirus tamped down the economy in the spring, the Federal Reserve moved to tamp down baseline interest rates. Mortgage rates, as they often do, soon followed. After a dismal spring home selling season, potential homebuyers poured out of the woodwork.
Statistics suggest now is the best time to sell a home in years. Record-low mortgage rates are boosting buying power, and the pandemic is boosting buyer motivation. Combined with a lack of supply, that means higher home prices. In July, the median home price shot up 8.5% to a new all-time high of $349,000.
As house hunters seek homes away from bigger cites – likely an effort to avoid coronavirus spread – suburban properties are growing in popularity.
If you have an urban home to sell, don’t despair. The flight to the suburbs, while real, isn’t the only place demand is rising. It’s just where it’s rising the fastest.
The housing market is booming now, but it could all change depending on what unfolds next.
For instance, more shutdowns could bring more layoffs and decreased demand. Lenders who have already tightened requirements may have to squeeze again. Not all borrowers will qualify for the lowest rates.
Important to note: With infection rates rising in some parts of the country, restrictions on home showings may take hold again. If you do decide to sell, check with your local real estate professionals for current guidelines.