Why Is the Market White Hot? No, It’s Not the Pandemic
Today’s market problems – a shortage of affordable housing, historically tight inventory of homes for sale and rising prices – weren’t caused by the latest pandemic-caused economic slowdown. It goes back to the Great Recession.
Experts say the U.S. housing market was already being roiled by forces fueling the current housing-price explosion even before the pandemic.
Matthew Murphy at New York University’s Furman Center for Real Estate & Urban Policy said supply shortages were evident heading into the pandemic, adding that “the context here to this current housing moment is that we were still recovering from the 2008-2009 foreclosure crisis.”
Meanwhile, the National Association of Realtors® has been pointing to an “underbuilding gap” of between 5.5 and 6.8 million housing units since 2001.
According to the National Association of Home Builders demand for single-family homes soared during the pandemic, and monetary policy accommodated this frenzy. The result has been a shrinking base of available homes for aspiring buyers.
The pandemic added to the existing problem. Experts say, for example, that more older Americans have been hesitant to let people into their homes or visit open houses because of COVID-19.
“You project out a year or two, and when rates have gone up, borrowers are going to look at increased prices and a new loan on a purchase and realize that staying in their own home is cheaper on a month-to-month basis,” says Todd Teta at ATTOM Data Solutions.
Building Costs Jump
Another factor in rising prices has been the sharp jump in building costs, with higher lumber prices alone adding almost $36,000 to the cost of building an average single-family home, according to the NAHB.
Marblehead Mid-Year 2021 Market Report
Swampscott Mid-Year 2021 Market Report
Salem Mid-Year 2021 Market Report
Beverly Mid-Year 2021 Market Report
Essex County Mid-Year 2021 Market Report
Team Harborside recognized on America’s Best Real Estate Professionals list
Are mortgage rates heading up or down?
Essex County 2021 Residential Property Tax Rates: a Town by Town guide
Naples market summary in June
Market Analyst | Team Harborside | teamharborside.com
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
“If you’re interested in Marblehead, you have to visit the blog of Mr. Andrew Oliver, author and curator of OliverReports.com. He’s assembled the most comprehensive analysis of Essex County we know of with market data and trends going back decades. It’s a great starting point for those looking in the towns of Marblehead, Salem, Beverly, Lynn and Swampscott.”
REALTOR® | Market Analyst | DomainRealty.com
Naples, Bonita Springs and Fort Myers