There have been a million and five thought pieces written on the housing market in 2020, including several by this blog right here. There's a newer post from HousingWire summarizing some of the September and October 2020 trends in home sales, including this map of new single-family home sales:
And, subsequently, this chart of the monthly supply of homes in the U.S., which is currently at 3.3 months:
Generally speaking, anything below 4.3 months of supply indicates that builders will have the utmost confidence to build. Higher levels of Inventory in the range of 4.4 to 6.4 months indicate slow and steady growth for housing starts, like what we saw from in the previous expansion.
If inventory breaks over 6.5 months, then the market has issues, and builders will likely stall on construction. This happened in 2018 when mortgage rates reached 4.75% to 5%.
Overall, new home sales are 41.5% year over year and 20.6% year to date.
This data does confuse some people -- it feels like the pandemic was a massive event (it was/is), and the economy seemed to suffer, especially service sectors, but also commercial real estate along the office side of those businesses. So how are house sales spiking so much? There's a lot of reasons, supply/demand issues being chief among them, but there's also the fact that people who are in the market for homes right now want homes with dedicated office space because we don't know exactly what the future of work looks like in terms of physical locations that we report to -- at least for white-collar professions.
In short, people are looking for different things these days when they purchase a home.
At the same time as the above trends are happening, though, the median renter is become older and more affluent, in part because COVID created a seller's market on the sales side. People sold, but the money from the sale didn't necessarily put them back immediately in the neighborhood they wanted to be in, so they decided to rent to be closer to friends, family, work, or restaurants/stores they are already comfortable with. You are seeing this rental shift big-time in places like Plano, Frisco, and Arlington.
In short, then, it's hot in two markets as 2020 ends: rentals and sales. And then there's a bottom arc of the housing bell curve, where housing advocates worry aid is not reaching the neediest people. 2020 housing-wise comes off as Dickensian in some ways: "It was the best of times, it was the worst of times..."
However it looks for you, if you have questions about 2021 and the markets and where to try and end up -- or whether it's time to try and buy -- contact us and we're game to help you with anything.