Low home inventory has been the story of 2020. For buyers, this is perhaps the most frustrating time in recent history. For sellers, well, let's just say they're doing alright.
While the number of homes sold last month actually exceeded August 2019, the total number of homes for sale was down 47%. This steep a decline in inventory is unprecedented.
As we enter what's shaking up to be a unique Fall season, homeowners and homebuyers should be prepared for a few changes.
The seasonal slowdown will come late. Normally, the market begins to slowdown when school starts, but 2020 is different for a couple reasons. First, virtual schooling and work from home has allowed families to continue the home search well into the school year. Second, and more importantly, many people searching over the summer are still in the market. Do you suppose this is what Bono meant in the 1987 hit, "I Still Haven't Found What I'm Looking For"?
Home sales may not drop during the election this year. Historically, the seasonal October to November decrease in monthly sales doubles during presidential election years, but this year may be different. Low inventory and low interest rates are keeping buyers in the market, but also political and societal uncertainty may create a sense of urgency to buy or sell sooner rather than later.
Interest rates will remain low. It's common for rates to be relatively low during the election cycle, however, Fed Chairman Jerome Powell recently announced that rates will likely remain around current levels for the foreseeable future, perhaps into 2022.
We won't see a rise in foreclosures...yet. There's been a lot of talk about upcoming foreclosures, but we don't anticipate a major uptick anytime soon. While mortgage delinquencies recently hit a 10-year high, the CARES Act coupled with high home prices, will likely keep foreclosures at bay. With that said, this trend could shift quickly in the early part of 2021 depending on how the next few months go.
For more Central Ohio real estate analysis, visit www.commoncents614.com, and as always, check out our flat-fee home listing service which has been helping homeowners save thousands of dollars since 2017.
Columbus Area Housing Market Statistics, August 2020
Data by Columbusrealtors.com