Source: National Association of Realtors
With the housing market staggered to some degree by the health crisis the country is currently facing, some potential purchasers are questioning whether home values will be impacted. The price of any item is determined by supply as well as the markets demand for that item.
Each month the National Association of Realtors (NAR) surveys over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions for the REALTORS Confidence Index.
Their latest edition sheds some light on the relationship between seller traffic (supply) and buyer traffic (demand) during this pandemic.
The map below was created after asking the question: How would you rate buyer traffic in your area?
The darker the blue, the stronger the demand for homes is in that area. The survey shows that in 34 of the 50 U.S. states, buyer demand is now strong and 16 of the 50 states have a stable demand.
The index also asks: How would you rate seller traffic in your area?
As the map above indicates, 46 states and Washington, D.C. reported weak seller traffic, 3 states reported stable seller traffic, and 1 state reported strong seller traffic. This means there are far fewer homes on the market than what is needed to satisfy the needs of buyers looking for homes right now.
With demand still stronger than supply, home values should not depreciate.
What are the experts saying?
Here are the thoughts of three industry experts on the subject:
We note that inventory as a percent of households sits at the lowest level ever, something we believe will limit the overall degree of home price pressure through the year.
Mark Fleming, Chief Economist, First American:
Housing supply remains at historically low levels, so house price growth is likely to slow, but it is not likely to go negative.
Two forces prevent a collapse in house prices. First, as we indicated in our earlier research report, U.S. housing markets face a large supply deficit. Second, population growth and pent up household formations provide a tailwind to housing demand.
Looking at these maps and listening to the experts, it seems that prices will remain stable throughout 2020. If you are thinking about listing your home, let us connect to discuss how you can capitalize on the somewhat surprising demand in the market now.
It is a common misconception that a real estate agent primarily learns of someone looking to buy or sell a home when someone simply calls an agency looking for an agent to help them. Although this can happen, it is very rare. In fact, over 80% of the referrals I receive come from past clients and past coworkers just like you. The other 15-20% of referrals comes from our national network of relocation companies and other Coldwell Banker agencies across the country.
The greatest compliment I can receive is when someone like you refers me to a friend, coworker or family member of theirs. If you, or someone you know, are looking to either buy or sell a home then I would certainly appreciate the opportunity to earn your business. Do you know of someone looking to buy or sell a home?
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