As much as I want to share the stats of recent sales and tell you how busy we’ve been and the bidding wars we’ve encountered. I would much rather answer the question that I keep hearing over and over. “Is this market sustainable? Are we in a bubble? Is the market going to crash?”
Obviously, no one can predict the future, but we can look at the information we have today and understand what is driving this market. It comes down to simple supply and demand. But what’s really important to understand is that the two are grossly out of balance. We have 65% less inventory than we did this time last year and while the demand is hard to measure, I believe it’s 5-10x what we see in a typical market. Despite the trend of paying 20-40% over asking, the buyers purchasing these homes are still qualifying for mortgages, which have very strict guidelines. Lots of transactions are cash and I attribute this to the increase in value of stock portfolios.
There is speculation that the mass rollout of the vaccine will in turn cause more people to put their homes on the market, but the balance is so far off right now that it is going to take a very long time to fill the buyer demand.
I have lots to talk about on this subject. If you want to hear more about my opinion and research on this subject please don’t hesitate to reach out. I would love to hear your thoughts as well!