Last week, the National Association of Realtors posted an article on How the Delta Variant is Affecting Real Estate. (The link to the complete article is below).
We all know that when COVID-19 hit in the spring of 2020, it threw life as we knew it into a tailspin. Businesses closed their doors. Employees lost their jobs. Sellers yanked their homes off the market and buyers were stuck in limbo as loan programs dried up, travel came to a halt, and people couldn’t even get into houses to tour them!
Within weeks, however, buyer demand was at an all-time high and would continue to surge through the first half of 2021. Home prices were increasing as much as 10% month over month in some communities in the Austin area.
Then, we saw a slowdown in May, returning to more normal seasonal trends PLUS people were taking vacations for the first time in two summers and looking forward to being out and about with family and friends.
Buyers and sellers alike were asking questions like?
- Is the market shifting or is it a temporary seasonal slowdown?
- Will we see a massive spike once again in the fall?
- Were we headed for a crash (the answer to that is no!)?
- And more!
Then, enter the delta variant! 😞
Now what?
Without going into the politics of COVID-19 and whether you’re for or against masks, are vaccinated, or have chosen not to get the vaccine, the question many have started to ask is if and/or how it’s going to affect the real estate market.
Some have speculated states with tighter restrictions and/or are considering stricter lockdowns will continue to push buyers to states like Texas and Florida, where governors are coming out strongly against mandates.
Others have stated that we’ve already seen the effects and that those who were going to leave have already done so.
There’s also a chance that some sellers will hold tight and forego the traffic through their homes unless they HAVE to sell right now, shrinking the inventory again.
Mortgage interest rates have edged down again due to the uncertainty in the markets, which would push some buyers back into the market that had taken a break or prompt others to take the plunge. As of today, 10 and 15-year rates are at 2.0%, 20-year rates are at 2.5% and 30-year rates are at 2.75%
According to Joel Kan, an economist at the Mortgage Bankers Association, in an article on Realtor.com, “We expect rates to bounce back between now and the end of the year.” So this MAY push buyer demand again through the year.
Presumably, rates are going to stay low for the foreseeable future and especially if the pandemic worsens!
So what does this actually mean?
Well, much like the last 18 months, we simply don’t know what’s going to happen in the next month or two… or into 2022.
But what we DO know is that RIGHT NOW is a great time to get in if you’ve been sitting out for a bit. The rates are basically back to all-time lows PLUS we have a much healthier supply of homes so we’re not seeing crazy overbidding right now. (Sure, there are still many offers over list price, but we’re not seeing 20%-30%-40%+ as the norm anymore).
This simply means if you were waiting for some of the chaos to die down, the time just may be right now…
To read the article on Realtor.com, click here: https://tinyurl.com/4ef3n57c
Until next time… keep smiling… be kind… and stay safe out there 🙂
