The coronavirus pandemic has thrown yearly shopping for and promoting patterns out of whack, with an enormous discount in stock and a rise in asking costs in most of the nation’s greatest markets.
In the course of the second quarter of 2020 — usually a time when the variety of listings spikes for the spring shopping for season — the 50 largest American metropolitan areas noticed a median of 23 p.c fewer properties listed in comparison with a yr earlier, in response to NerdWallet’s First-Time Home Buyer Metro Affordability Report — Q2 2020.
Right this moment’s super-low rates of interest, which make it attainable to borrow more cash on the identical month-to-month value, would appear to assist residence consumers, however the inventory-depleted market counteracts the profit. Bidding wars that drive up buy costs are inevitable with elevated competitors, so this yr fewer potential consumers will be capable of discover a residence they will afford.
What’s been the impact on asking costs? In keeping with the report, within the second quarter of 2020 they have been up by a median of about three p.c in these 50 metro markets in contrast with a yr earlier, and about 5 p.c above the primary quarter of 2020. General, these charges of development are similar to patterns in recent times. However consumers beware: Given the shortage of properties and low rates of interest, contemplate the second quarter’s asking costs proven on this week’s chart as mere beginning factors. Closing sale costs will usually be greater than marketed.