In May, lumber prices reached all all time high, at $1,670.50, more than six times their pandemic low in April of 2020, but as of July prices have tumbled by nearly 60% since hitting peak in May!

Senior economist at Fastmarketsr RISI, Dustin Jalbert states it could take weeks before retail centers begin to see the effects of the rate cuts. He adds, “Prices are probably not going to fall to the levels that they were before the pandemic.”

Dale Oxley, director of NAHB West Virginia agrees, “That decline was really at the mills. The consumer really hasn’t seen that 30% to 40% because a lot of the… local suppliers haven’t burned off that high-price product.”

Will we see a direct correlation from the price of lumber and the price or property?

Not likely – yet.

Alex Barron, president of the Housing Research Center told Bankrate, “Lumber is not the main reason why homes are unaffordable. It is the lack of resale supply.”

Read the full article here and share your thoughts with us! 

Redfin’s Tim Ellis published a Housing Market Update in which he notes the key housing market takeaways for 400+ U.S. Metro areas.

“The housing market’s temperature may be starting to drop by a degree or two. Both pending sales and asking prices began to decline or flatten in the four weeks ending May 30. It’s too soon to tell if these are early seasonal changes or the start of the post-pandemic cooldown we predicted earlier this year. The period in question includes the beginning of Memorial Day weekend, which this year marked a return to “normal” life. It may also have marked the beginning of a return to a more “normal” housing market. We should know more as we continue to track the latest data over the next few weeks.”

Indicators of last month’s history-making housing market:

• A record-high median home sale price of $355,558, up a record 24% year over year.
• A record high of 52% of homes sold for more than their list price, up from 26% the same period a year earlier.
• A record-high 102.0% average sale-to-list price ratio, which measures how close homes are selling to their asking prices. This means that the average home sold for 2.0% more than its asking price. A year ago, it sold for 1.5% below asking.
• A record low of 16 days on market for homes that sold during the period, down from 37 days from the same period in 2020.

 

Early indicators that the housing market may be starting to soften:

Each of the metrics highlighted in the following list set a new housing record going back at least as far as 2012, when Redfin’s data began.

• Pending home sales fell 3% from the four-week period ending May 2, compared to a 2% increase over the same period in 2019. Compared to 2020, they are up 38%.
• Asking prices fell $2,500 from the four-week period ending May 23 to a median of $354,975, up 11% from the same period in 2020.
• New listings of homes for sale were down 8% from the same period in 2019, and are down 5% from the 2021 high, which was set during the four-week period ending May 2. During the same period in 2019, new listings fell 2%.
• Active listings (the number of homes listed for sale at any point during the period) fell 37% from the same period in 2020.

Read the full article here which contains stats for home sale prices, asking prices, pending sales, and new listings among many other things. 

Realtor.com’s research team releases weekly housing trend key finding. This week they relayed, “The number of new sellers has climbed from a year ago in the last 6 weeks, yet another measure highlighting the stark change between this year and last year. Despite the influx of sellers, the number of homes actively for sale is still down and homes continue to sell quickly and for higher prices.”

A quick snap shot of the Weekly Housing Trends: 

• Median listing prices grew at 15.5 percent 
• New listings–a measure of sellers putting homes up for sale–were up 8 percent, making this the 6th consecutive week of increases over last year.
• Total active inventory remains 51 percent below this time last year.
• Time on market was 32 days faster than last year

Click here to read the entire article & see a comparison chart that compares March to May. 

“Home prices are up 27% year over year in seasonal towns” reports Dana Adams, of Redfin.

“The number of buyers who locked in mortgage rates for second homes soared 178% year over year in April, marking the 11th straight month of 80%-plus growth. The record increase should be taken in context: It is likely exaggerated because demand for second homes dropped 24% year over year last April, the month after the coronavirus pandemic hit the U.S. and real estate activity in the country nearly ground to a halt.

The rise in demand for second homes is more than twice the increase for primary homes, with the number of buyers who locked in mortgage rates for primary homes rising 78% year over year in April. That’s a record jump, too, but should also be taken in context, as demand for primary homes dropped last April due to the pandemic.”

Click here to read more about price increase in both seasonal and non-seasonal towns! 

US home prices jumped the most in 7 years in December as the housing-market boom charged into the new year, Case-Shiller says.

“The S&P CoreLogic Case-Shiller US National Home Price Index posted a 10.4% annualized increase in December, according to a Tuesday press release. The gain follows a 9.4% annualized climb in November and marks the biggest single-month leap in seven years seen by the index, a leading national dataset.”

“Still, the US housing market will likely thrive through 2021 as more forthcoming stimulus bolsters homebuying activity, Fitch analysts led by Suzanne Mistretta said in a February 16 note. The firm said it expects prices and mortgage volume to continue growing in 2021 due to consistently low borrowing costs and lasting supply constraints”

Read the full article here.

 

“From December 2020 to January 2021 the one-month appreciation, an annualized 7.5 percent rate, was the slowest recorded since August 2020. Historically, home prices have come under pressure during periods of economic stress as foreclosure sales and other distressed transactions add discounted properties into the inventory. During the Great Recession, monthly volume of sold properties that were considered distressed peaked at nearly 82,500 units (March 2011) and represented more than 43 percent of all sales that month. In contrast, January 2021 recorded the lowest ever number of distressed sales transactions, at 11,212 units. The tally represented just 4.9 percent of total sales for the month. This lack of distressed supply is a marked difference from prior periods of economic stress.”

Read the full Business Wire article here.

Each year the Home Buying Institute analyzes current real estate market trends and conditions across the United States to offer a forecast for the upcoming year. This year there are lots of things to consider.

Below are the top five predictions for the 2021 real estate market.

1. Home prices will continue rising in most U.S. cities.
2. Housing market inventory will remain tight in 2021.
3. Home sales will remain steady going into next year.
4. Mortgage rates will hover around 3% next year.
5. It will be another good year for refinancing.

Click here to read the full article.

Overall, Yun said he felt confident that home prices would maintain their stability throughout the pandemic, but he did not anticipate that prices would soar, “particularly in the second half of the year.”
What might the future hold? Yun predicts that home sales could be 20 percent higher in the third and fourth quarters compared to the prior year. Additionally, he sees home sales rising more than 5 percent, possibly 10 percent, in 2021, as a vaccine becomes available and possibly leads to faster job growth with still favorable mortgage rates, which should stay near 3 percent.

 

Buffini said that for the next three years, as interest rates stay low per the Federal Reserve’s guidance, real estate professionals should put in extra efforts and make sales, even buying the very assets they sell.

 

You can read the full article here.

There are fewer homes for sale in the U.S. today than ever recorded in data going back nearly 40 years.

“We are simply facing a housing shortage, a major housing shortage,” says Lawrence Yun, the chief economist at the National Association of Realtors which tracks home sales. “We need to build more homes. Supply is critical in the current environment.”

“Housing inventory shortages have pushed national home prices considerably higher,” says Joel Kan, vice president of economic forecasting for the Mortgage Bankers Association.

“We have been under producing for the past decade,” Yun says. “We need more construction.”

Yun had much more to say, see the full NPR article here. 

National Housing Market Data

According to Realtor.com’s Monthly Housing Market Trends Report:

• National inventory declined by 38% over the last year.
• Inventory of newly listing properties decline by 7% nationally.
• The national median listing price in October was $350,000, up 12% compared to last year.
• The typical home spent 53 days on the market this October which is 13 days less than last year, and one day less than last month.

Forbes reports,  “For the first time since 2011, homes sold faster in October than September and prices remained at their summer peak of $350,000.”
“Realtor.com®’s October housing data release reveals that sellers returned to the market, as the decline in newly listed properties substantially improved…While the national price growth rate continued to accelerate to historical highs, larger metros saw a slight softening, signalling a small reprieve for buyers in this active autumnal season.”