Is today's housing supply a sweet spot for sellers?

Wondering if it still makes sense to sell your house right now? The short answer is, maybe.

An article from Calculated Risk shows there are 15.6% more homes for sale now compared to the same week last year. That tells us inventory has grown. But going back to 2019, the last normal year in the housing market, there are nearly 40% fewer homes available now:

How does this benefit sellers?

1. You Have More Options for Your Move

Are you thinking about selling because your current house is too big, too small, or because your needs have changed? If so, the year-over-year growth gives you more options for your home search. That means it may be less of a challenge to find what you’re looking for.

So, if you were holding off on selling because you were worried you weren’t going to find a home you like, this may be just the good news you needed. Partnering with a local real estate professional can help you make sure you’re up to date on the homes available in your area. 

2. You Still Won’t Have Much Competition When You Sell

But to put that into perspective, even though there are more homes for sale now, there still aren’t as many as there’d be in a normal year. Remember, the data from Calculated Risk shows we’re down nearly 40% compared to 2019. And that large a deficit won’t be solved overnight. As a recent article from Realtor.com explains:

“. . . the number of homes for sale and new listing activity continues to improve compared to last year. However the inventory of homes for sale still has a long journey back to pre-pandemic levels.”

For you, that means if you work with an agent to price your house right, it should still get a lot of attention from eager buyers and could sell fast.

Bottom Line

If you're a homeowner looking to sell, now's a good time. You'll have more options when buying your next home, and there's still not a ton of competition from other sellers. If you’re ready to move, talk to a local real estate agent to get the ball rolling.

---

Are Home Prices Going Up or Down?

Media coverage about what’s happening with home prices can be confusing. A large part of that is due to the type of data being used and what they’re choosing to draw attention to. For home prices, there are two different methods used to compare home prices over different time periods: year-over-year (Y-O-Y) and month-over-month (M-O-M). Here's an explanation of each. 

Year-over-Year (Y-O-Y):

• This comparison measures the change in home prices from the same month or quarter in the previous year.For example, if you're comparing Y-O-Y home prices for April 2023, you would compare them to the home prices for April 2022.

• Y-O-Y comparisons focus on changes over a one-year period, providing a more comprehensive view of long-term trends. They are usually useful for evaluating annual growth rates and determining if the market is generally appreciating or depreciating.
  
  

Month-over-Month (M-O-M):

• This comparison measures the change in home prices from one month to the next. For instance, if you're comparing M-O-M home prices for April 2023, you would compare them to the home prices for March 2023.

• Meanwhile, M-O-M comparisons analyze changes within a single month, giving a more immediate snapshot of short-term movements and price fluctuations. They are often used to track immediate shifts in demand and supply, seasonal trends, or the impact of specific events on the housing market.

The key difference between Y-O-Y and M-O-M comparisons lies in the time frame being assessed. Both approaches have their own merits and serve different purposes depending on the specific analysis required.

Why Is This Distinction So Important Right Now? 

We’re about to enter a few months when home prices could possibly be lower than they were the same month last year. April, May, and June of 2022 were three of the best months for home prices in the history of the American housing market. Those same months this year might not measure up. That means, the Y-O-Y comparison will probably show values are depreciating. The numbers for April seem to suggest that’s what we’ll see in the months ahead (see graph below):

That’ll generate troubling headlines that say home values are falling, and that’s accurate on a Y-O-Y basis. But, those headlines will lead many consumers to believe that home values are currently cascading downward.

However, on a closer look at M-O-M home prices, we can see prices have actually been appreciating for the last several months. Those M-O-M numbers more accurately reflect what’s truly happening with home values: after several months of depreciation, it appears we’ve hit bottom and are bouncing back.

Here’s an example of M-O-M home price movements for the last 16 months from the CoreLogic Home Price Insights report (see graph below):

Why Does This Matter to You?

So, if you’re hearing negative headlines about home prices, remember they may not be painting the full picture. For the next few months, we’ll be comparing prices to last year’s record peak, and that may make the Y-O-Y comparison feel more negative. But, if we look at the more immediate, M-O-M trends, we can see home prices may actually be on the way back up.

Bottom Line

If you have questions about what’s happening locally or how this impacts your home’s price, please don’t hesitate to reach out!

Real Estate Market Report: March 2022

March is officially behind us so it’s time for our monthly check-in on the Massachusetts real estate market. Today we’ll discuss the implications of the total residential inventory across the state as well as the median home price.

TOTAL RESIDENTIAL INVENTORY

STATEWIDE INVENTORY

Single-family, condo & multi-family listings

Mar 2019: 13,482 listings
Feb 2022: 3,927 listings
Mar 2022: 4,470 listings

Compared to last year, inventory is still very low. In fact, inventory is 66.8% lower than it was in March in 2019 (pre-COVID times). That’s a whopping 9,012 homes.

On the bright side, month-over-month inventory is starting to come back. There are 543 more homes on the market this month bringing the total to 4,470. That’s a 13.8% increase from February. Still, we have a long ways to go to satisfy current demand.

MEDIAN HOME PRICE

STATEWIDE Median Home Price

Single-family, condo & multi-family listings

Mar 2019: $519,000
Feb 2022: $689,900
Mar 2022: $699,900

As you’re probably aware, home values are quite high right now… The median home price across the state has increased by $180,900 since March of 2019.

This 34.8% increase was due to a variety of factors, most notably the sharp decrease in both interest rates and home inventory. 

Historically, home values nationwide appreciate about 3% a year. In Massachusetts, from March 2010 to March 2019, home values rose by about 58% or roughly 6% per year. Compare that to the 11.6% annual appreciation that we are currently seeing and it is obvious that home values are quite a bit ahead of where they should be.

What does that mean for you?

Real Estate Recap: 2020 in Review

2020 was an unusual year to say the least! When it comes to real estate, we are officially in the middle of one of the strongest seller’s markets we’ve seen in years. Let’s take a look at the stats to see what that meant for the market in 2020 and where it leaves us now.

Covid took an already competitive market and pushed it further than we could’ve ever imagined thanks to an increase in buyer demand and a decrease in inventory and interest rates. When the lockdown began, many listings were pulled off the market or delayed, all while everyone was spending more time in their homes than ever before. With no where to spend their money, many people started thinking about renovating their current home or perhaps upgrading to a new one. Add them on top of the already massive subset of buyers who were ready to buy their first house (even more so now that they felt trapped in their current living situation) and you end up with a historic amount of buyers waiting to enter the market.

Finally, restrictions eased up and homes started hitting the market, but there just weren’t enough to satisfy the demand. Homes were selling left and right, often for way over asking price as buyers found themselves in bidding wars for a place to live. Let’s take a look at some of 2020’s stats to see what that really meant for the housing market:

2020 Housing Market Stats

These stats focus on the towns we are most familiar with:
Attleboro, Canton, Easton, Foxboro, Franklin, Mansfield, Norfolk, N. Attleboro, Norton, Plainville, Sharon, Stoughton & Wrentham

Single-family Homes

2020

Total Homes Sold: 2877
Average Days on Market: 44
Average Sale Price: $522,390
Sale Price to List Price Ratio: 101%

2019

Total Homes Sold: 2824
Average Days on Market: 56
Average Sale Price: $485,910
Sale Price to List Price Ratio: 99%

Condos

2020

Total Condos Sold: 1001
Average Days on Market: 47
Average Sale Price: $348,956
Sale Price to List Price Ratio: 101%

2019

Total Condos Sold: 927
Average Days on Market: 56
Average Sale Price: $309,347
Sale Price to List Price Ratio: 100%

The stats are a little surprising! Anecdotally, it felt like there were far less homes on the market last year than in 2019, but that wasn’t true. There were actually more homes sold in 2020, they just were on the market less time with a majority of them selling after their first showings or open house.

Price-wise, Massachusetts already high real estate values went even higher. Single-family homes and condos both saw about a 10% jump in values! On top of that, the average sale was closing for 101% of the list price (asking price). There were a lot of happy sellers out there!

Where do we stand now?

The market is still strong in the seller’s favor. In fact, inventory is lower than before thanks it being mid-winter. If you’re thinking about selling, now is a great time to learn what your home is worth. But keep in mind, getting a lot of money for your house is only part of the equation. You need to consider where you will go from there. May we suggest: Should you sell in a seller’s market?

You deserve a better real estate experience.

» Learn about the benefits of buying and selling with us.

Should you sell in a seller's market?

We’re in one of the strongest seller’s markets in recent history and you’re thinking about selling your home because it’s appreciated in value quite a bit. Does it make sense? For some people it does and for others it doesn’t, let’s think it through…

Why do you want to sell?

My house is worth a lot and I’d like to cash in on that.

Your house is suddenly worth a lot of money, that’s great and all, but we do suggest that people don’t look at their primary residence as an investment. You’ll always need a place to live and if you sell in a seller’s market you’ll have to buy in a seller’s market. If you really want access to your equity think about what you’d use that money for. In many cases refinancing or utilizing a home equity loan is actually a better decision.

We’ve been wanting to upgrade our home or change towns and we want to sell while the value is high.

Well you can’t argue with that… So what now? You’re going to sell while values are high, but unfortunately that means you’ll have to buy high too. Can you avoid this?

Sometimes you can! Here are a few ways to sell high and avoid buying high so that you can save some of those profits:

Move to a lower cost of living area.

Planning to move out of state or to a different town? If the area has a lower cost of living than where you live currently then the decision is to sell is an easy one.

Downsize your home.

If you’re planning to downsize, that also makes the decision pretty easy. In this situation it’s likely that you’ll be able to purchase a new home and still save a good amount of the profits from your sale.

Find temporary housing.

If you’re looking to stay in the same area then you’ll need to wait for the market to cool down a bit. It’s hard to say when that will happen so now it’s you vs the clock. Do you have somewhere you can live in the meantime? Perhaps your family has an in-law apartment or maybe you sign a cheap lease for a year while you wait to see what the market does. Just make sure that your temporary housing costs don’t eat into your profits too much.

Say “heck it” and upgrade!

There’s nothing wrong with wanting to cash out your equity and use it all to upgrade your living situation. In fact, that is a great use of your home’s equity provided you can find a home that’s right for you. Keep in mind though, in a competitive market there’s a good chance you may have to win a bidding war. So take a look at your finances carefully to make sure that you don’t end up being forced to make a lateral move.

It can be a lot to think about so we’re here to help you weigh your options. Buying and selling real estate doesn’t have to be a stressful experience, in fact we work hard to make sure it’s as simple, stress free, and rewarding as possible.

You deserve a better real estate experience.