Real Estate Corner: Summer is Here and the Real Estate Market is Hot!

I put a home on the market last week for $1,750,000 and over a 3 day period we had 22 buyers that came to see the home. All of them provided me with proof of funds and a pre-approval letter before they came to the showing. This home sold with 3 offers over asking.

Last week, my buyers agent came back from showing a young couple a few homes that are for sale in the 1.2 million dollar range in the valley. For the first showing, the agent had only 1 time period left in the day in which to show the house, all the other time slots, each 20 minutes in length, were taken. She had 15 showings that day, and by the end of the day had 2 offers in hand and a few more expected. The listing agent advised my buyers agent and our buyers that if they were interested they needed to get an offer in that night. Another house that they were interested in seeing had sold within 3 days at $200,000 over asking. It was just south of Burbank Blvd. in Encino and was only 1800 sq feet, also priced at $1,999,000. There were actually only 3 houses on the market in their price range with their specific criteria.

So if someone tells you now is not a good time to sell because of the pandemic they are wrong. Real Estate is still a hot marketplace. Sellers are going on market with fairly strong prices. We are only seeing reductions with those homes that are not selling within the first 60 days on market.

It can be a challenging market for the buyer. Inventory is still exceedingly low, with the number of homes for sale falling well short of the demand. Housing market experts predict that sharp declines in home prices seem improbably as buyer demand has remained relatively strong despite the pandemic. There are a lot of new buyers out there wanting to purchase while investors have taken a pause. Millennials represent a growing segment of the house buying population. Many need to get into larger homes because they have a growing family. And of course, on the other side of that equation are the empty nesters who are downsizing.

One of the reasons home sales seem brisk despite the pandemic is the effect of lower mortgage rates which have reignited the need to buy a home. These mortgage rates are expected to remain the same through 2022. We’ve all been spending a lot more time in our homes. Many of us have been working out of our homes and have become far more familiar with what we need to live and work in them. With money being cheap right now, why not go for buying a home that fits your needs emotionally, economically and just because you can. This pandemic has limited our ability to enjoy the many pleasures of life that we probably took for granted, but one pleasure that we still can enjoy is home ownership.

Although home sales have declined due to social distancing and economic unpredictability, home prices are still strong. We are seeing houses that are priced right going into multiple offers every day. Inventory is low and listings have declined across the nation. There are no open houses right now. Everything is by appointment and if you’re a buyer you need to sign a COVID-19 consent form that you will be wearing a mask and not touching the surfaces of those homes that are still being lived in. The fear of other people coming into your house during the pandemic is daunting. Sellers are nervous about letting strangers in. Houses that are not occupied are easier to show and far more likely to be seen.

But that said, we are still showing houses by appointment in homes that are still occupied. Many forecasters are predicting a short term bump in sales for late summer and early fall due to pent up buyer demand, fear of the pandemic, and low mortgage rates. But here in the San Fernando Valley most agents have never been busier.