We have repeatedly noted that the housing market is set to become less lucrative than it has been over the last year-and-a-half, but that doesn’t mean that time has come to pass yet. During Q3 2021, profit margins on single-family homes and condos hit a decade-high according to ATTOM Data Solutions; the typical seller (nationally) saw profits of roughly $100k (e.g., the sold the home for $100,000 more than they purchased it for). This reality is driven primarily by the fact that the median home sale price increased by 16% over the last few years, sitting at a comfortable $310,500.00 (again, this is nationally). This increase is attributed to record low inventories at a time when demand was reaching an all-time high by virtue of COVID-19’s impact on remote work.
To demonstrate the impact that COVID-19 had on the housing market, it is important to understand that many employers were forced to adopt a remote-work scheme in order to continue operations. It was only a matter of time before people realized they could live anywhere with an internet connection. Boise, Idaho was a major beneficiary of this realization; homes are currently selling for 130.3% more than they were purchased for. Similarly, Bellingham, Washington saw 105.6% profit margins; Claremont, New Hampshire saw 93.8% profit margins; Raleigh, North Carolina saw profit margins of 67%; and Augusta, Georgia saw profit margins of 56.6%. Experts believe this trend will continue until at least Q1 2022.
At the Chernov Team we understand that knowledge is power, and knowledge of increasing profit margins in the housing sector is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leave with the most, and the Chernov Team always leaves the table with the most.