The 2021 selling season should be the craziest market in the history of the world.
My theory: The covid-19 pandemic has jumbled the usual timing of the elective movers, and we are experiencing a not-natural compression of reasons to move.
We will have our Big Three (death, divorce, and job transfer) causing their usual sales. Making the difference will be the elective buyers and sellers who expedite their plans.
There are always a group of buyers and sellers who contemplate moving for 1-5 years before they get around to it. But the current environment (covid+ultra-low rates+unemployment+prices+politics) has captured their attention, and it will pull forward buyers AND sellers from 2022-2023.
Plus we will have some buyers AND sellers who ordinarily wouldn’t have even thought about moving until 2022-2023 who are realizing sooner that they should move in 2021.
Not all of them, but some of them.
It won’t take many.
We have been very fortunate to have a steady consistent flow of listings and sales over the last few years. The number of listings between January and August varied by less than 1% between 2017 and 2019.
The pandemic changed that though, and look at results. Listings dropped off significantly YoY (-11%) yet sales are only down 4%. Oh happy day, we’re surviving the covid – for now!
NSDCC January-August
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| 2020 |
But we know that more than half of boomers delayed their plans of selling in 2020.
All we need is for the compression of moving motivations to cause 500-800 more listings in the 2021 selling season and it will be a whole new ball game – unlike anyone has seen recently!
Historically, buyers are known to freeze up quickly when they see more homes hitting the market. But all we need there is 300-400 more buyers to jump at the chance of securing their forever home at ultra-low rates, and ending their unsettling insanity of 2020.
With all the bidding wars, there are probably 300-400 unsatisfied buyers in the marketplace today.
Next year’s selling season could be the Frenzy of All-Time!
It’s great to see a “mom and pop” element of the economy (which RE agents are) that’s not getting decimated by COVID and the self-serving reactions of our politicians.
I dont know that I share your enthusiasm for next year but thats why they make chocolate AND vanilla ice creme. Either way, you deserve respect for putting such a strong stance out there.
My bold prediction is that next year the market figures out how to value a granny flat and does so richly. The Lund boys just sold a house nearby with a premium of $100 to 150K for a 400 square foot detached studio built with permits. It should only go up from there.
Yep, and I got a big extra pop for my Carlsbad listing that was granny-ish. Story coming at closing in 10 days.
Here’s the one you mentioned – and it was a full wood shop, which you don’t see often, and for the woodworkers it’s beyond sexy:
https://www.compass.com/listing/3523-sitio-baya-carlsbad-ca-92009/568174062453677865/
Either way, you deserve respect for putting such a strong stance out there.
I appreciate the props, thanks.
More than anything, I’d like to highlight how easy it is to impact the market. The sample sizes are so small (400 NSDCC sales per month) that a 10-20% swing in either direction could happen at any minute. It did this summer, in a good way!
For $100K plus thats far beyond sexy. There are more tools in that shed then a Stormy Daniels video
Agree! If it came fully-outfitted, it was a deal.
> Next year’s selling season could be the Frenzy of All-Time!
Covid driven delay loading will no doubt push some expected 2020 inventory into 2021. There’s also the long delayed bubble hangers on who can now get out “even. ” They are also 12-14 years older now. The only thing that can crash the party is rates.
The only thing that can crash the party is rates.
Oh, you saw that 1/8% bump today?
Last year it took rates getting into the mid-4% to get buyers to stall, which was about 1% higher than a few months prior.
If we use the same margin, it means the stall-target in 2021 will be the high-3s. It sounds ridiculous by historical standards!
But what it really does is make buyers more picky. The value squeeze will be brutal on those who don’t spend enough on preparing-to-sell items.
> The value squeeze will be brutal on those who don’t spend enough on preparing-to-sell items.
Fixers are so 2008.
Personally I hate this but i understand the math. Prep, fix, fluff, market, close fast.