The housing market, like most of the economy, came to a near standstill in March and April. This forced the typical spring summer buying season to be delayed until the summer. Once economies reopened, pent-up demand translated into sales of both new and existing homes, driving home prices in many places to record highs. In July, home sales spiked 13.9%.
New home sales
According to the commerce department, new home sales are up 32.1% year-over-year. With this said, sales of new homes fell by 3.5% in September to a seasonally adjusted annual rate of 959,000 million units. The July figures may have been the top of the housing market. New home sales for August were revised downward to 994,000 from a previously reported 1.01 million units. The median price of a new home sold was $326,800, according to the Commerce Department.
Existing home sales
Existing-home sales grew for the fourth consecutive month in September, according to the National Association of Realtors®. Each of the four major regions witnessed month-over-month and year-over-year growth, with the Northeast seeing the highest climb in both categories. Of course, the consistent theme in this market continues to be a lack of inventory. While we typically see less homes hitting the market in the final few months of the year, the pandemic may be affecting this more profoundly.
As we enter the final two months of the year, most Americans tend to shift their focus on the holidays & therefore put off home buying. As an added wrinkle, many predict that the number of COVID-19 cases will rise during this time of the year as well. While we certainly hope that spikes like those seen earlier in the year do not happen again, anything is possible with this unpredictable pandemic. The silver lining for buyers is that mortgage rates are predicted to remain low for the foreseeable future. In addition, we should start seeing some more inventory after the new year.