Piquet RealtyÂ Founder and President. Skydiver, Ironman Triathlete, JiuJitsu Fighter and Race Car Driver on the weekends.
This year has brought a lot of unforeseen circumstances, but one of the most incredible surprises has been the high demand and low rates in a housing boom thatâ€™s sweeping across the country. Many real estate companies were prepared to see a suffering market during a pandemic, but instead experienced growth and an inventory shortage.
According to the Mortgage Bankers Association, mortgage applications to purchase a home jumped 9% in the last week of November 2020 and were 28% higher annually. Joel Kan, MBAâ€™s associate vice president of economic and industry forecasting, said, â€œHousing demand remains strong, and despite extremely tight inventory and rising prices, home sales are running at their strongest pace in over a decade.â€
Most properties hitting the market now are sold in a matter of weeks. Even our own agents have been working at record speeds with our clients when a property of interest is found due to how fast properties are being sold. Hopeful homebuyers spend time searching for properties and when one of interest is found, itâ€™s not uncommon that buyers are met with the news that an offer was made and accepted a few hours later. Agents are working at rapid speeds and conducting socially distant on-site showings due to the marketâ€™s high demand. Weâ€™ve also seen property prices discounted at extremely low prices due to owners no longer being able to make their payments. These owners are rushing to sell their properties as soon as possible.
According to the chief economist with Florida Realtors, Dr. Brad Oâ€™Connor, here in Florida where my firm operates, home sales, prices, pending sales and new listings are all up from last year. Single-family home sales are up by 22% and condo sales by 25.3%. And in California, according to a report released by property management software company ManageCasa, sales dropped 1% in October 2020 from the previous month, but still exceeded the number of homes sold in October 2019 by 19.9%.
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In a market that benefits both buyers and sellers, both will need to be ready to tread into new territory and act quickly. Many real estate specialists believe this trend will last well into the new year. But like seasons, it is bound to change before long.
My advice to homeowners who are looking to sell their current homes is to take action immediately. Within this type of real estate market, theyâ€™re bound to get an offer that meets their asking price quickly. We have also seen buyers put an offer well above the asking price to ensure the sale is made, which is obviously good news for sellers.
When it comes to the homebuyer, time is of the essence. I suggest buyers get pre-approved as fast as they can before their search begins. Act quickly and be ready for a bit of a bidding war. But with rates this low, their efforts are bound to pay off in the future. By the end of November, Freddie Mac reported 30-year, fixed-rate loans were as low as 2.72% over the past week, down from their previous low of 2.78% earlier in the month. This is worth taking advantage of.
Opportunity is definitely knocking for homebuyers and sellers alike. My advice to everyone involved with real estate is to seize it, move forward and invest wisely.