1. Prices have climbed 32.6% for newly listed homes
Since the pandemic began in 2020, prices for newly listed homes have risen by 32.6% across the USA and in large metro areas they have increased by as much as 43%. The median home price for April 2021 was $375,000 which represents a 17.2% increase over 12 months since April 2019.
2. Supply availability more than halved
Total inventory decreased by 53% as a result of increased demand which has led to a seller’s market as demand is increasing against this drop in supply, creating shortages which are increasing prices.
3. 21% increase in buying power
With record low interest rates and average incomes matching inflation rates, buying power has increased. Despite rising prices, buyers can get more property for their money with a 21% increase in buying power.
4. Fixed rate mortgages hovering around 3%
Cuts to the federal funds rate by The Federal Reserve successfully kept consumer-level interest rates low throughout the pandemic. Interest rates for fixed rate mortgages have remained stable at, or below, 3% since March 2020.
5. Nearly 4 out of 5 senior citizens are homeowners
79% of people aged over 65 are currently homeowners, as are 76% of people ages 55 to 64. This represents a significant customer base who will be looking to sell in the coming years in order to downsize or move into assisted living.
6. 2021’s median house price was $350,300
Due to high demand and increased buying power with limited supply, prices rose continuously from 2020 through 2021. House prices increased $13,000 in 2018 and $25,000 in 2019, however in 2020 prices rose $66,000, almost double the previous two years combined, leading to a median house price of $350,300
7. Nearly 6 million houses sold in May 2021
Total volume of house sales rose 45% in May 2021 compared to 12 months previously. While a decline in total available properties for sale demonstrates “seller’s market” conditions, high demand shortened time spent on market and less desirable properties were sold faster than previous years.
8. Average number of days on market is 37
In 2020 houses stayed on the market for an average of 71 days, however due to increased demand and decreasing supply, properties in 2021 sold on average in 37 days. This places pressure on buyers to move quickly on suitable properties, to the benefit of the seller.
9. Existing supply dropped under 2 months
At current stock levels, if no new properties were listed on the market and no new properties were built, the supply of existing houses would be exhausted in 1.9 months. Normal market conditions have a supply of four to five months, with a drop to 3.1 months in 2020 and as low as 1.9 months in the winter of 2021.
10. First homeowners represent 31% of the market
There was a slight decrease in the market share of first homeowners buying properties from 33% in 2020 to 31% in 2021. While the average age of homeowners remained steady at 47 years old, the median household income of homeowners increased to $96,500.
11. Nearly half of all buyers search online first
When looking for properties, only 18% of buyers contact an agent first. 43% of buyers search online first, only contacting an agent once they’ve found a property to view. 97% of buyers conducted some research online in 2021.
12. The most competitive buyer’s market in the USA is San Jose
Although most of the USA is in a seller’s market, San Jose is the most competitive buyer’s market where available properties outnumber buyers greater than anywhere else in the country. In contrast, Virginia Beach is the most competitive seller’s market with the least amount of available properties and the highest number of interested buyers.
13. Thursday listings sell fastest
In 2021 on average, properties listed on a Thursday sold as much as 6 days faster and for a higher price than properties listed on any other day of the week. Listing on a Thursday can help secure quick offers as buyers can utilise the weekend to inspect newly listed properties.
14. The majority of millennials have regrets about homeownership
While only 33% of Baby Boomers regret homeownership, 66% of Millennials regret some aspect of their purchase, the most common of which are costly maintenance and fees.
15. The average homebuyer spends 8 weeks looking
In 2021 the average home buyer viewed a median of 9 homes total over an average of 8 weeks, only viewing 4 in person. This reflects the significant impact of the pandemic and the importance of online presence and marketing of properties.
16. The midwest leads the nation in homeownership
70.3% of people in the Midwest of the USA own their own homes, in contrast to only 59.7% of people on the west coast.
17. The largest homes are purchased by GenX
The median house size purchased by GenX in 2021 was 2,100 square feet, significantly bigger than any other generation. Consequently their median price of $305,000 was also the highest per generation, representing the demographic most appropriate to market larger properties.
18. Married couples were 62% of all homebuyers
Almost 2 out of every 3 buyers in 2021 was a married couple, with single women representing the next biggest market at 19%. Only 9% of sales went to single men and the remaining 9% were unmarried couples.
19. Rent in 2021 increased in 26 states
Compared to 2020, average rent increased in 26 states with Louisiana the highest, increasing by 38%. Only 15 states saw declining rents with Illinois reporting the biggest decrease at 9.6%
Conclusion
With a significant decline in available properties and increasing buying power due to favourable economic conditions, 2021 proved to be a fantastic year to sell property. As conditions continue to remain similar for the immediate future, now is a great time to be encouraging sellers to put their property on the market to leverage the favourable conditions.