Like in many industries, there was certainly some cause for concern in real estate when the pandemic came about. New listings, pending sales and closings all dipped in March and April as uncertainty swept the nation. Fast forward to June, and the Utah real estate market has seen a surge like no other.
We've seen record setting numbers both in our brokerage and this market: pending sales have poured in and closings are right behind them. Compared to last year at the same time, our pending contracts have doubled. While this buyer confidence is a promising sign for our market, it means that the pre-existing inventory shortage has only been worsened. So now what?
Why is this happening?
- Federal mortage rates are at an all-time low: 2.99%
- Before the pandemic, demand was already high in Utah. This is the market's way of overcorrecting
- Many out-of-towners are leaving big cities due to social unrest, high taxes and COVID seeking the Park City lifestyle
- We are seeing a significant increase in out-of-state buyers, putting even more strain on the low inventory
- The average length of time homebuyers stay in their homes has increased over time: now 10 years
How long will the craziness last?
- The high demand for homes will almost certainly carry into Fall. Some experts are predicting it will continue well into 2021
- Fear not, we are seeing an increase in seller confidence. New listings growth has recovered to pre-pandemic levels
What does it mean?
- NOW is the time to buy. Prices are continuing to increase, and these low mortgage rates wont last forever
- Sellers are getting more for their listings due to the high demand