Housing Market Will Stay ‘Hot’ in the New Year

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There’s no shortage of people ready, willing, and able to buy homes, according to the latest report from Redfin. In fact, the four-week period ending on December 13 has shown us some record highs and lows for the housing market.

For starters, the median home sale price is higher than it’s ever been. After a 15% year-over-year increase, the new number is $322,616, very impressive given the global pandemic that made the market dip during the earlier part of spring.

In fact, pending home sales increased 32% year over year. In the week ending on December 13, pending sales actually increased 28% from the same week in 2019.

Another all-time high, the average sale-to-list price ratio—this is how close asking prices are to actual sale prices—is at 99.5%. that’s a 1.5% increase over last year.

Mortgage rates hit another all-time low, falling to 2.67% for the typical 30-year mortgage. Rates have remained below 3% since late July of this year.

And according to Redfin, things will only slow down for the house buying market if there’s a decline in listings. The Redfin Buyer Demand Index shows a 32% increase in demand since January and February—pre-pandemic levels. The index has remained steady since July.

But that listing issue is indeed an issue. Active listings fell 30% from 2019, an all-time low. However, 39% of those listings went under contract within their first two weeks on the market, up from 26% at the same time last year.

Even with low inventory, the market is hot for sellers. There’s no denying that.

“At a time of year when the housing market usually goes into hibernation, homebuyers are doing anything but hibernate,” said Redfin chief economist Daryl Fairweather. “With the coronavirus vaccine set to roll out just as the housing market typically kicks into full gear, a combination of seasonality and the pandemic’s final chapter is likely to keep the housing market hot well into 2021.”

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