Extreme inventory shortages have been no match for the intense buyer demand. We’ll see how that exchange continues to play out, but so far 2021 sales, values and the percentage of homes selling at or over list price and within 10 days are all up while market times are down.
Anyone thinking of buying or selling in the next year or two may want to step it up to take advantage of the interest rates, lower-than-they-will-be prices and to lock in with a lower cap on their property assessment. All these things are moving in a way where acting sooner will lock in great financial advantages for years.
Extreme buyer demand continues to put pressure on Southeast Michigan inventory levels, which are down 61% compared to last year.
Despite depleted inventories, closed sales and weekly showing activity are up, values are rising, and market times are dropping.
The average sale price is 98.5% of asking and over half of sales are at or above full list price— both higher than any time since 2015. Market times continue to shrink—lower than any time since 2015. YTD average market times are down to 42 days and 43% of listings show up as pending within 10 days.
Inventory shortages, especially in the entry and middle price ranges, continue to fuel buyer competition and multiple offers that drive up values. Typically, price per square foot declines during the 4th quarter as inventory gets picked over and demand drops off. As seen in the lower chart to the left, the red price per square foot bars, of the 2020 fourth quarter, stood tall and carried momentum into 2021. YOY average price per square foot was up 15% in February.
Expect demand to remain high and supply levels to remain low through 2021. Prices will continue to rise. Anyone thinking about moving in the next year or two may want to jump in early to take advantage of lower interest rates and prices. Buying sooner will also lock in property assessments with lower caps. These advantages benefit both buyers and sellers.