Redfin has compiled data on the house market for a 4-week period, ending on October 4,
2020, and the date is very good for potential sellers. Let’s briefly discuss some of their findings.
Most homeowners are particularly interested in housing prices, for obvious reasons, and
the 4 week numbers paint an exciting picture – the national median home sale price increased by 15% since last year to $320,625.00 (this is the highest on Redfin’s records, dating back to 2012).
Keeping in line with this, the average median asking price of new listings increased by 14% from the previous year, and 12.9% for the four weeks ending on September 27, 2020 (that means the week of September 27, 2020 to October 4, 2020 was a very good week). Despite the
skyrocketing housing prices, home sales increased by 26% from last year (though this is the
smallest increase since August 16, 2020).
Notably, just under half of the homes that were under contract with an agent accepted an
offer within two weeks of putting their home on the market; this has been true for a little over 4
months. Additionally, the sale-to-list-price ratio, which is a measure of consistency between
asking price and sales price (if everyone got exactly what they asked for, the number would be a 100%; keep in mind that this measure doesn’t account for seller credits, and anything else that might reduce the final sales price), hit an all-time high of 99.4%
There are a number of reasons for the increase in housing prices, and the data provides
some insight into this. Active listings (defined as the number of houses listed for sale at any point during the data collection period) decreased by over a quarter from it’s 2019 point; this is a
historic low.
Given the historically low mortgage rates, and the historically low amount of inventory,
the housing market was already primed to see an increased median housing price. The data
supports this. More importantly, homes are selling quickly at the sellers’ asking prices; this
suggests that housing prices will continue to increase until asking prices aren’t being accepted so quickly.
We suspect that once everything normalizes there will be an over-correction in housing prices (which would be a great time to buy), so selling at the height of the market, or waiting until the market stabilizes from an over-correction, is the most prudent decision you can make if you are considering selling your home.
At the Chernov Team we understand that knowledge is power, and knowledge of the
numbers behind the market’s behavior is powerful knowledge indeed. At the Chernov Team we
know that whoever comes to the table most prepared leaves with the most, and the Chernov
Team always leaves the table with the most.