Dusty and Missy Broderick

Purchasing a home? We've got you covered.

The residential real estate market is remaining resilient as the country still struggles to beat the COVID-19 pandemic. Three separate reports recently revealed how the housing market is still showing growth. Here’s a look at each one. 1. Ivy Zelman’s Real Estate Broker Survey The survey explains that purchaser demand remains strong:... This month’s overall homebuyer demand ratingwas easily the strongest sequential gain in our survey historyStrength continues to be led by the entry-levelWhile high-end demand is less robust in an absolute sense, there has also been relative improvement, with contacts attributing incremental improvement to the stock market’s rebound, record low mortgage rates and luxury customers trading out of high-priced cities. 2. The National Association of Home Builders Housing Market Index The index reveals that builder confidence has returned to levels last seen prior to the pandemic: In a strong signal that the housing market is ready to lead a post-COVID economic recovery, builder confidence in the market for newly-built single-family homes jumped 14 points to 72 in July, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The HMI now stands at the solid pre-pandemic reading in March before the outbreak affected much of the nation. 3. The Realtor Housing Market Recovery Index This index leverages a weighted average of four key components of the housing industry, tracking each of the following: Housing Demand Growth in online search activity Home Price Growth in asking prices Housing Supply Growth of new listings Pace of Sales Difference in time-on-market It then compares the current status to the last week of January 2020 market trend, as a baseline for pre-COVID market growth. The overall index is set to 100 in this baseline period. The higher a market’s index value, the higher its recovery and vice versa. The latest results came in at 101, with Realtor explaining: The U.S. Housing Market has recovered from the immediate disruption caused by the COVID pandemic and returned to January 2020 growth levels. Bottom Line Real estate brokers, home builders, and industry data all agree that the housing market has surged back to pre-COVID levels, showing growth, strength, and incredible resilience.

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As remote work continues on for many businesses and Americans weigh the risks of being in densely populated areas, will more people start to move out of bigger cities? Spending extra time at home and dreaming of more indoor and outdoor space is certainly sparking some interest among homebuyers. Early data shows an initial trend in this direction of moving from urban to suburban communities, but the question is: will the trend continue? According to recent data from Zillow, th...ere is a current surge in urban high-end listings in some larger metro areas. The month-over-month increase in these homes going on the market indicates more urban homeowners may be ready to make a move out of the city, particularly at the upper end of the market Why are people starting to move out of larger cities? With the ongoing health crisis, it’s no surprise that many people are starting to consider this shift. John Burns Consulting notes: The trend is accelerating faster than anyone could have predicted. The need for more space is driving suburban migration. In addition, Sheryl Palmer, CEO of Taylor Morrison, a home building company, indicates: Most recently, we’re really seeing a pickup in folks saying they want more rural or suburban locations. Initially, there was a lot of talk about that, but it’s really coming through our buyers today. The National Association of Home Builders (NAHB) also shares: New home demand is improving in lower density markets, including small metro areas, rural markets and large metro exurbs, as people seek out larger homes and anticipate more flexibility for telework in the years ahead. Flight to the suburbs is real. Will the shift pick up speed and continue on? The question remains, will this interest in suburban and rural living continue? Some, like Lawrence Yun, Chief Economist at the National Association of Realtors (NAR) think the possibility is there, but it is still quite early to tell for sure. Yun notes: Homebuyers considering a move to the suburbs is a growing possibility after a decade of urban downtown revivalGreater work-from-home options and flexibility will likely remain beyond the virus and any forthcoming vaccine. While much of the energy behind this trend has largely been accelerated by the current health crisis, monitoring the momentum over time is critically important. Businesses are discovering new and innovative ways to function in remote environments, so the shift has the potential to stick.

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So far, it’s been quite a ride this year, and our nation has truly seen its fair share of hurdles. From COVID-19 to record unemployment and then the resulting recession, just to name a few, the second quarter of 2020 has had more than a few challenges. Amidst the many roadblocks, however, the U.S. homeownership rate rose again, signaling great strength in the recovery of the housing market and an indication that even in a time of crisis, Americans still feel confident about b...uying a home. U.S. Census Bureau announced: The homeownership rate of 67.9 percent was 3.8 percentage points higher than the rate in the second quarter 2019 (64.1 percent) and 2.6 percentage points higher than the rate in the first quarter 2020 (65.3 percent). There are many reasons why the homeownership rate in this country is rising, and one of the key factors is historically-low mortgage rates. Rates hovering at all-time lows are helping to drive affordability and enabling more potential homeowners to enter the market today. According to Ralph McLaughlin, Chief Economist for Haus: Mortgage rates are the icing on the cake for households that were thinking about buyingThey found an unexpected opportunity during the worst economic downturn America has seen since the Great Depression. In addition, many potential homebuyers have been using their time this year to search for homes that offer more space than their current rental apartments. Many of these homebuyers are younger and, as noted by Odeta Kushi, Deputy Chief Economist at First American, are the buyers driving the homeownership rate in an upward direction: Big jump in the homeownership rate today, mostly driven by younger households. We saw a spike in the number of owners, and a decline in the number of renters. This is the highest rate of homeownership since 2008. This growth is outstanding news for the housing market and for those who have recently found their new homes. If homeownership is on your shortlist this year, maybe now is a great time to meet with a real estate professional to evaluate your current situation. Perhaps historically low mortgage rates can help you to become a homeowner too.

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Thank you to all of our clients for making July such a great month. We're so happy to have helped each of you advance your financial and real estate goals.