In many cases buyers aren’t buying homes – they are winning homes. There appears to be no clear end in sight.
With all the headlines about crazy home prices, fears that we’re in the midst of the next housing bubble, and nonsensical speculation that cities are DEAD forever, I feel obligated to add some context to what TF is exactly happening..So here we go.
The state of the housing market: April 2021
Apartment style housing in crowded city environments accounted for the majority of new properties built following the 2008 housing collapse. In our region we’ve endured the endless construction of high- rise style homes in planned communities geared towards recent college grads – from DC proper to the suburbs. Meanwhile around July of 2019 (according to Pew Research) millennials ( defined as 25 – 40 years old) have quietly overtaken the Baby Boomers as the largest living adult population. Well, it appears the largest demographic of consumers are growing up, and so have their housing needs. What happens when the average millennial is 32, living in an apartment, and the entire world shuts down overnight? Immediately the appeal of crammed city living, close to bars and restaurants (that are now closed) is all but gone. The decision to migrate to suburbia from their city dwellings would have taken a few years, but COVID made that an easy, immediate, and logical decision. Welcome to our new normal.. where space, privacy, and white picket fences are king again.
So what does this mean for today’s real estate market?
The condo market is struggling to find its way through the pandemic. There are more condos than buyers – especially in high rise style buildings. That said larger condos with outdoor space, or those units which offer multiple floor living are doing fine overall.
The market for single family homes and townhouses below $1million is on fire. In 13 years of working in the housing market I’ve never seen anything like the current demand. Bidding wars and escalations are to be expected. Contingencies of any sort are almost always waived by the buyers. The $1 million or less market for single family homes is where the vast majority of millennial home buyers are shopping. And simply put there are not nearly enough properties to fill the demand. Own a house in this category that you’re considering selling? Don’t miss this opportunity..
The luxury markets starting at $1.5m+ are trickier to navigate but buyers are willing to pay more than in years past. I’ve also seen that buyers are willing to spend more on their ideal house which has helped boost the luxury markets that offer dreamy outdoor spaces or privacy that cannot be found at other price points. The amount of homes transferring above $1.5m+ has reached a high point.
If you have any questions or want to explore your specific housing needs, get in touch!