Earlier in the month I wrote about the sudden reversal in the number of listings when comparing 2020 to 2019. I have been tracking that metric on a weekly basis, and the results have been more of the same.
The original chart that I used to illustrate the dramatic shift is probably no longer the best way to visualize what is happening in the market. There is now enough data since the 2020 market transitioned into COVID mode that we can clearly see the different trajectory in the total cumulative listings in each year. Below is a new chart that is based on the same information … listings in 2020 compared to listings in 2019.
The big blue area represents 2020, versus the line showing the 2019 totals as of the same day. There were clearly more listings in 2020 through early March. Once the State imposed restrictions to combat the virus, the pace of new listings slowed dramatically. This is visible as the steepness of the top of the 2020 area. It is much less steep since mid-March than it was in February. At this point there are very clearly fewer listings in 2020. The gap was 557 listings as of Saturday 4/25.
What I like about this chart is that it emphasizes that thousands of homes have been listed for sale so far this year in Hartford County. The real estate market is still open, and functioning, but it’s behaving a little differently than normal. The key to navigating the market is to understand what has happened, and then act accordingly.
The important difference between this year and last year is in the inventory of available homes. There are too few homes for the number of buyers interested in purchasing them. Although this was arguably true in 2019 as well, the situation is much worse right now. More owners (potential sellers) sitting out the spring market than potential buyers.
This creates an opportunity for sellers, and a hurdle for buyers. We are seeing desirable homes sell for a premium over what we would have considered “fair market value” as of February. This is because buyers are competing for the properties, and bidding up the prices.
Our expectation is that the local real estate market will remain undersupplied for the rest of the year. Be sure to keep this in mind if you are considering a move – whether you are a buyer, a seller, or both. As always, we are happy to advise you on your specific situation. Feel free to contact us at any point.