We have another disrupter who is providing a service you didn’t know you needed until now.
Traditionally, a buyer’s agent accompanies their clients to show them the homes for sale, and to give expert advice about each house while on site. But other real estate companies – who don’t appreciate that valuable service – have dumbed it down by just paying door-openers that allow buyers into the house, but leave them on their own to figure out the rest.
A new company has taken it one step further, and is providing an Uber-like service where random agents can get paid for opening doors for other agents.
The company charges $39, and pays $24 of it to the door-opening agent – who agrees to not offer advice to the buyers, and to direct them back to the agent who paid the $39 showing fee.
This year’s orange line has plateaued. It’s been in the 70% range all month, meaning there has been 70% more showings each week than there were during the first week of the year.
Even though it’s twice as much, it mirrors the 2019 trend that the spring selling season is underway, and I think we can assume that every buyer who is thinking about moving in 2021 is out looking at homes.
The buyer pool is full, and engaged. Sellers, no need to wait!
Two weeks from today, the year 2020 will come to an end.
We are heading into 2021 with a strong surge of buyer interest. In spite of the current active inventory being far less than it was in 2019, there are more than twice as many people looking at homes today.
It has to carry over to next year! Hopefully there will be something to buy.
Last year, the showings in early December ended up about where they were during the previous January. But this year we had a huge post-Thanksgiving bounce, and are now 175% above the same time last year!
This looks like a dramatic drop-off in showings but we are still 160% above where they were last year, and way above where they were in February. If there were just more homes for sale!
We got off to a hot start in 2020, and you can see how showings in January of this year picked up immediately compared to November, 2019. Let’s compare the December showings over the next few weeks to give us a feel for how fast the market will get started next year!
Not only does the current level of showings make up for the dip we had at the beginning of the Covid-19 market, but the 7-day moving average was higher on Saturday than all but two days this year (now 225% higher than it was during the first week of 2020).
As long as mortgage rates are under 3%, people will be looking!
Just like the price of gasoline, mortgage rates are very slow to come down, but they tend go up like a rocket – and with the surprising employment news today, we’ll probably get back into the mid-3s by Monday. We’ll see if the lowest rates in history were the sole reason why showings rebounded so quickly. From cnbc:
What’s good news for the U.S. economy is suddenly bad news for mortgage rates. A far-better-than-expected May employment report only added to a growing sell-off in the bond market, pushing yields to the highest level since March. Mortgage rates loosely follow the yield on the 10-year Treasury.
Rates have been rising this week, after sitting around a record low for the last two weeks. Friday, the average mortgage shopper may see rates on the 30-year fixed as much as a quarter point higher, according to Matthew Graham, COO of Mortgage News Daily, which runs daily averages from lenders.
For those with top-tier credit and financials, they may only see an eighth of a point increase, but for those with lower scores and down payments, the jump could be as much as 0.375%.
“It’s going to be ugly,” said Graham. “Today is the first time since the Covid-19 market reaction settled down in March that interest rates truly have a reason to panic. Until further notice, this looks like liftoff.”
This is not, of course, the last word in a mortgage market that has been on a rate roller-coaster ride fueled by a massive spike in mortgage delinquencies, an initially confusing and risk-ridden government bailout, and an overstressed loan servicing system. The mortgage bailout has been clarified, with parts rewritten to help servicers, the number of borrowers in forbearance plans is shrinking and mortgage companies are on a massive hiring spree.
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