Housing Market Setting Records, In Spite of Pandemic
In spite of the pandemic, home sales are booming both nationally and here in Worcester County.
Sales increased by a record 24.7% from June to July, according to the National Association of Realtors, which said the gain is the strongest since the NAR began its monthly survey in 1968.
With the economy beginning to reopen and Realtors adjusting to doing more of their work online, it’s no surprise that July sales showed a significant increase from June. However, sales were also up 8.7% from July 2019 — before the pandemic.
Sales were driven not only by the re-opening economy, but by record-low mortgage rates. Unfortunately for buyers, low rates and a shortage of inventory boosted the price of homes sold by 8.5% from a year earlier to $304,100. Even when adjusted for inflation, the price is 3.4% higher than the price during the 2006 bubble.
We expect the current seller’s market to continue until inventory increases. Downsizing baby boomers will help add to inventory, but an increase in new construction is also needed. New housing was being constructed in July at a seasonally adjusted annual rate of 1,496,000 homes. That’s 22.6% higher than the June estimate of 1,220,000 homes and is 23.4% higher than the July 2019 rate of 1,212,000 homes.