Existing-Home Sales Soar 9.4% to 6.5 Million in September

Key Highlights

  • Existing-home sales grew for the fourth consecutive month in September to a seasonally-adjusted annual rate of 6.54 million – up 9.4% from the prior month and nearly 21% from one year ago.
  • The median existing-home price was $311,800, almost 15% more than in September 2019. Total housing inventory declined from the prior month and one year ago to 1.47 million, enough to last 2.7 months – a record low – at the current sales pace.
  • More than 7 in 10 homes sold in September 2020 – 71% – were on the market for less than a month.

Regionally

Existing-home sales in the South increased 8.5% to an annual rate of 2.80 million in September, up 22.3% from the same time one year ago. The median price in the South was $266,900, a 13.0% increase from a year ago.

The National Association of Realtors® is America’s largest trade association, representing more than 1.4 million members involved in all aspects of the residential and commercial real estate industries.

Click for full NAR news release

September 2020 Real Estate Statistics – DC Metro Area

It Started With A Referral

One referral turned into two resulting in two happy clients. Now we are all connected.

Congratulations to Chad, Katie and Logan.

It started with a reciprocal referral from a California agent whose son’s best friend wanted a bigger home for his expanding family. As a recent grad from the
United States Naval Academy, becoming a parent to a son and adopted dog Lucky, with mom planning to go back to work and what looked like, job wise a longer stint in Maryland it was time to move, Covid-19 and all. We are currently operating in a highly competitive market with historically low interest rates. After 27+ house tours, interviewing 2 lenders, investing in a pre-home inspection, 3 written and submitted yet rejected offers, they closed on the house that was meant to be. 10,000 lower than list price, plus a seller credit. Well worth the effort. Congratulations! #BestClientsEver


Where Are Home Values Headed Over the Next 12 Months?

As shelter-in-place orders were implemented earlier this year, many questioned what the shutdown would mean to the real estate market. Specifically, there was concern about home values. After years of rising home prices, would 2020 be the year this appreciation trend would come to a screeching halt? Even worse, would home values begin to depreciate?

Original forecasts modeled this uncertainty, and they ranged anywhere from home values gaining 3% (Zelman & Associates) to home values depreciating by more than 6% (CoreLogic).

However, as the year unfolded, it became clear that there would be little negative impact on the housing market. As Mark Fleming, Chief Economist at First American, recently revealed:

“The only major industry to display immunity to the economic impacts of the coronavirus is the housing market.”

Have prices continued to appreciate so far this year?

Last week, the Federal Housing Finance Agency (FHFA) released its latest Home Price Index. The report showed home prices actually rose 6.5% from the same time last year. FHFA also noted that price appreciation accelerated to record levels over the summer months:

What are the experts forecasting for home prices going forward?

Below is a graph of home price projections for the next year. Since the market has changed dramatically over the last few months, this graph shows forecasts that have been published since September 1st.

Where Are Home Values Headed Over the Next 12 Months? | MyKCM

“Between May & July 2020, national prices increased by over 2%, which represents the largest two-month price increase observed since the start of the index in 1991.”

Bottom Line

The numbers show that home values have weathered the storm of the pandemic. Let’s connect if you want to know what your home is currently worth and how that may enable you to make a move this year.


09.28.2020 Maryland Real Estate Trends Echos Much Of The Countries


August Housing Data Reveals a Robust Summer Market Amidst Declines in Inventory

  • Median Sale Price is up 9.7%
  • Average Sale Price up 11.2%
  • Months of Inventory down 60% to 1.4 months
  • Median days on market are down from 22 to 9
  • Seven of Maryland’s rural counties have seen over 20 percent increases in average prices over last year.
ANNAPOLIS, MD – September 28, 2020 Maryland’s August housing market demonstrated substantial recovery from spring’s COVID-related disruptions, according to housing statistics released by Maryland REALTORS®*. Data from June through August show both an increase in average and median home prices, and a decline in months of available inventory, echoing nationwide trends and sparking concern over housing imbalances.

“The average sales price increased year-over-year from $361,823 to $402,452 and the median price increased from $310,000 to $340,000, growth of 11.2 percent and 9.7 percent, respectively” said Maryland REALTORS® President John A. Harrison. “Months of inventory dropped 60 percent to just 1.4 months, compared to 3.5 last year, which is a historic low for the state. Moreover, the median days on market fell from 22 to 9 which aligns with stories we’ve heard of bidding wars and homes selling within hours of hitting the market.”

“The most notable, but unsurprising, feature of the current housing market is the sharp rise in activity in rural areas,” said Harrison. Seven of Maryland’s rural counties have seen over 20 percent increases in average prices over last year. With the rise in working from home, commute times are less of a factor. That and the relative affordability of rural areas make urban and some suburban communities less attractive. “The pandemic has prompted individuals and families to reimagine their housing requirements, often desiring home office space and more expansive outdoor living areas.”

Ready to Sell? Homebuyer Traffic Is on the Rise.

Regardless of having to make offers knowing they are up against multiple competitive buyers, some having to write on several houses before going under contract, buyer activity is continuing to rise.

It’s worth rethinking your timeline on selling. Developing a plan is free.


Urban to Suburban Lean

Congratulations Dave and Gulmira! After 14 years in Cleveland Park, DC it was time for more space and a sprawling yard. Despite the challenges of Covid-19, three rejected offers, a rent back and a short time rental they ended up with the perfect house and location for them. Thank you for trusting me to facilitate listing one home and buying the next.

Cleveland Park, DC to Kensington, MD – view listings

Two New Surveys Indicate Urban to Suburban Lean

There has been much talk around the possibility that Americans are feeling less enamored with the benefits of living in a large city and now may be longing for the open spaces that suburban and rural areas provide.

In a recent Realtor Magazine article, they discussed the issue and addressed comments made by Lawrence Yun, Chief Economist for the National Association of Realtors (NAR):

“While migration trends were toward urban centers before the pandemic, real estate thought leaders have predicted a suburban resurgence as home buyers seek more space for social distancing. Now the data is supporting that theory. Coronavirus and work-from-home flexibility is sparking the trend reversal, Yun said. More first-time home buyers and minorities have also been looking to the suburbs for affordability, he added.”

NAR surveyed agents across the country asking them to best describe the locations where their clients are looking for homes (they could check multiple answers). Here are the results of the survey:

  • 47% suburban/subdivision
  • 39% rural area
  • 25% small town
  • 14% urban area/central city
  • 13% resort community/recreational area

According to real estate agents, there’s a strong preference for less populated locations such as suburban and rural areas.

Real Estate Brokers and Owners Agree

Two New Surveys Indicate Urban to Suburban Lean | MyKCM

Zelman & Associates surveys brokers and owners of real estate firms for their monthly Real Estate Brokers Report. The last report revealed that 68% see either a ‘moderate’ or ‘significant’ shift to more suburban locations. Here are the results of the survey:

Bottom Line

No one knows if this will be a short-term trend or an industry game-changer. For now, there appears to be a migration to more open environments.


Have You Ever Seen a Housing Market Like This?

Have You Ever Seen a Housing Market Like This? | MyKCM

The year 2020 will certainly be one to remember, with new realities and norms that changed the way we live. This year’s real estate market is certainly no exception to that shift, with historic highlights continuing to break records and challenge what many thought possible in the housing market. Here’s a look at four key areas that are fundamentally defining the market this year.

Housing Market Recovery

The economy was intentionally put on pause this spring in response to the COVID-19 health crisis. Many aspects of the common real estate transaction were placed on hold at the same time. Thankfully, technology and innovation helped the industry power forward, and business gradually ramped back up as shelter-in-place orders were lifted.

The result? Total transformation of the market from rock-bottom lows to exceptional highs. Today, the housing recovery is being called truly remarkable by many experts and is far exceeding expectations. From pending home sales to purchase applications, buyers are back in business and homes are selling – fast.

Have You Ever Seen a Housing Market Like This? | MyKCM

According to the Housing Market Recovery Index by realtor.com, the market has surpassed pre-pandemic levels, and has regained the strength we remember from February of this year (See graph below):

Record-Breaking Mortgage Rates

Historically low mortgage rates are another 2020 game-changer. Today’s low rate is one of the big motivating factors bringing buyers back into the market. The average rate reached an all-time low on multiple occasions this year, and it continues to hover in record-low territory.

When rates are this low, buyers have a huge opportunity to get more for their money when purchasing a home, something many are eager to find while continuing to spend more time than expected at home this year, and likely beyond.

Continued Home Price Appreciation

One of the key drivers of home price appreciation this year is historically low inventory. Inventory was low going into the pandemic, and it is still sitting well below the level needed for a normal market. Although sellers are slowly making their way back into the game, buyers are scooping up homes faster than they’re coming up for sale.

This is a classic supply and demand scenario, forcing home prices to rise. Selling something when there is a higher demand for what is available naturally bumps up the price. If you’re ready to sell your house today, this may be the optimal time to make your move. As Bill Banfield, EVP of Capital Markets at Quicken Loansnotes:

“The pandemic has not stopped the consistent home price growth we have witnessed in recent years.” 

Increasing Affordability

Even as home prices continue to rise, affordability is working in favor of today’s homebuyers. According to many experts, rates this low are off-setting rising home prices, which increases buyer purchasing power – an opportunity not to be missed, especially if your family’s needs have changed. If you now need space for a home office, gym, virtual classroom, and more, it may be time to reconsider your current house.

According to Mortgage News Daily:

“Those shopping for a home can afford 10 percent more home than they could have one year ago while keeping their monthly payment unchanged. This translates into nearly $32,000 more buying power.

Bottom Line

With mortgage rates hitting historic lows, home prices appreciating, affordability rising, and the market recovering like no other, 2020 has been quite a year for real estate – perhaps one we’ve never seen before and may never see again. Let’s connect today if you’re ready to take advantage of this year’s record-breaking opportunities.


Does It Make Sense to Continue Renting? When You Can Lock In An Unprecedented Low Interest Rate For 30 Years

The Cost of Renting Vs. Buying a Home

The Cost of Renting Vs. Buying a Home [INFOGRAPHIC] | MyKCM

Some Highlights

  • The percentage of income needed to afford a median-priced home today is declining, while that for renting is on the rise.
  • This is making buying a home an increasingly attractive option for many people, especially with low mortgage rates driving purchasing power.
  • Let’s connect if you’d like expert guidance on exploring your home buying options while affordability is high.

Builders & Realtors Agree: Real Estate Is Back

Builders & Realtors Agree: Real Estate Is Back | MyKCM

When shelter-in-place orders brought the economy to a screeching halt earlier this year, many believed the residential housing market would follow suit. Countless analysts predicted buyer demand would disappear and home values would depreciate for the first time in almost a decade. That, however, didn’t happen. It appears the opposite is taking place.

After the bottom fell out of the real estate market immediately following the shutdown, it has come roaring back – and seems to still be gaining steam. Here’s a look at two recent reports – one from the National Association of Home Builders (NAHB) and one from the National Association of Realtors (NAR) – showing this growing strength.

Builder Confidence Hits All-Time High

Last week, it was reported that applications for new home purchases with home builders were 39% higher than in July of 2019. That has builder confidence soaring.

Each month, NAHB releases its Housing Market Index, a survey of NAHB members who rate market conditions for the sale of new homes at the present time and over the next six months, as well as prospective buyer traffic for new homes.

This month, they reported that builder confidence in the market for newly-built single-family homes increased to the highest reading in the 35-year history of the series. NAHB Chairman, Chuck Fowke, explained:

“The demand for new single-family homes continues to be strong, as low interest rates and a focus on the importance of housing has stoked buyer traffic to all-time highs…Housing has clearly been a bright spot during the pandemic and the sharp rebound in builder confidence over the summer has led NAHB to upgrade its forecast for single-family starts, which are now projected to show only a slight decline for 2020.”

The number of newly constructed homes being built will be almost at the same level as last year, even though the economic shutdown crushed home building earlier in the year.

Existing Homes Are Also Selling Like Hotcakes

Last Friday, NAR released its Existing Home Sales Report. The report revealed that month-over-month sales increased by 24.7%, setting another record for the category. The Wall Street Journal reported that the increase crushed expert forecasts:

“Economists surveyed by The Wall Street Journal expected a 14.2% monthly increase in sales of previously-owned homes, which make up most of the housing market.”

Home sales increased by 8.7% year-over-year.

Lawrence Yun, Chief Economist for NAR, explained how the resale market is just as hot as the new construction market:

“The housing market is well past the recovery phase and is now booming with higher home sales compared to the pre-pandemic days. With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand even into 2021.”

In addition, the Housing Market Recovery Index, which is released monthly by realtor.com, also showed the market is recovering nicely. The latest index reading was 104.8, which means the housing market is doing better than it was in January and February of this year. As a reference, the highest point in the index was a 106.5 in early March, just prior to the health crisis setting in.

Bottom Line

Both the newly constructed and existing home sale markets are posting numbers greater than a year ago. Real estate is back. If you’re thinking of buying or selling, let’s connect so you have the expert counsel you need along the way.


It’s All About RE|lationships

It’s our goal as agents but we don’t always get too many opportunities to work with people more than once. I am so glad that Sam and Ben were some of those clients. It’s been so rewarding watching their progress and their success come to fruition.

One of the best benefits of working with first time home buyers is that I get to watch how their lives unfold.
I first met Sam and Ben in 2016. What a great starter home!

“Laurel is not only an amazing realtor but our friend for life. We met her when we were looking to buy our first home and she walked us through each step in the process, she was kind and patient. We felt like we could take our time finding the right fit. We called Laurel again, as our family grew and realized we needed something bigger, our forever home. This was at the beginning of COVID and we were anxious about the challenges that may come with selling and buying at this time. Laurel again, walked us through the process and was there for us when we had questions. She helped ease our fears and frustrations. She helped us sell our home quickly while ensuring we got the best deal possible, and was able to help us find our forever home in which we needed a very short time to close. Laurel was honest each step of the way and spoke honestly about the pros and cons of each home we looked at to ensure we found the right home for our needs. Laurel is not only knowledgeable but also trustworthy and personable. She made a journey that can sometimes be painful, fun and easy. The only downside to finding our forever home is not being able to work with her again!”

– Sam and Ben

Four years later, plus one little one, a masters degree and a whole lot of hard work and success, they bought their forever home.