Friday Update January 22, 2021
Sun is shining, weather is sweet. Makes you want to move your house hunting feet. Every single house I showed this week with one exception had at least one agent in front of me and one agent behind me showing. On a few occasions there were groups of like 20 people waiting to get in. Everyone was wearing their masks and due to the fact that buyers are all mortal enemies to each other right now social distancing was not a problem.
We have 217 single family homes in our local market today. Just like last week it's not enough or even close to enough. Year to date we have 511 sales in our local market with the median price YTD at $387,000. Don't trip on the fact it was $395,000 last week, prices aren't dropping, we just have a small sample size statistically speaking. Multiple offers are so common that anything other than your A game as a buyer is for sure not going to be good enough. One day that will change, but today is not that day.
Interest rates on the 10 year treasury notes are finishing this week a tiny bit lower than last week. The stock market hit another set of record highs mid week with a lot of exuberance over what turned out to be a peaceful transition of power. Today the market is giving back some of those profits and so the yield on the notes took a little bit of a bump down. Statistically and practically irrelevant as rates remain near record lows.
Demand for homes and the number of existing homes sales is the highest since 2006. December of 2020 numbers came out nationally showing that existing home sales were up 22% year over year. Nationally inventory has been at record lows so this for sure isn't just a Colorado Springs problem.
The other day I shared a CNBC article about a Federal proposal to give first time buyers a $15,000 credit to help them buy a house. I said it was a terrible idea because it is creating more demand where we have a supply side problem. Some of you guys told me that not every market is like ours and that this is a good idea. I'm sorry to say this but every market that matters is like ours. Rural communities are always going to have their own unique real estate markets that are completely independent from what is happening in cities. 273 million Americans live it cities, roughly 52 million Americans live in rural markets. This action may help the rural communities to some extent but will further hurt buyers in urban communities which make up the vast majority of what we call the real estate market.
What could be effective from the Federal government would be some form of tax credit for people that decide to sell homes. We have a supply side issue, so stimulating supply to produce more of it would seem like the rational way to deal with this. Ultimately though the govenrnment should stay out of the market entirely because everytime they try to stimulate one thing or another we tend to get shit results.
Long story short is more of the same folks. If you're looking to sell a home this year give me a call and I'll show you how easily you can cash out. If you're looking to buy a home be prepared, do your homework, have your stuff together and be ready to compete.