March and April is the time of the year when the real estate market springs into action with people on the move – whether they are relocating, moving to a bigger home, downsizing or just looking for that big yard on the small lake.
Like the temperatures here in Michigan, the real estate market warms up with the weather in those early spring months. But everything changed this year, in a year unlike and unfortunately, like anything most people have ever experienced. In early March, a “blizzard” hit that shut everything down and sent home buyers and sellers into hibernation along with the rest of the world as a deadly pandemic changed everything.
Dan Elsea, president and CEO of Real Estate One, said on March 20: “One of our challenges is that whatever projections we make today may not be relevant tomorrow. But what we do know now, and have seen over the past few weeks, is that some sellers have concerns over showing their homes during this time.”
The folks at Real Estate One were proactive at the time – putting safety and health concerns on the front yard. For example, Ewing Pros of Real Estate One, launched an innovative “Virtual Open House” using online technology which featured an agent doing a “live” video tour of the home. Rob Ewing, owner of Ewing Pros, said the tours were very successful at the time.
But the time has changed and people are slowly returning to a more comfortable and familiar way of life. And one thing that changed in a hurry was the real estate market that quickly and surprisingly went from shut down to booming in a matter of months.
Elsea says the entire real estate market was in unfamiliar waters and it was very difficult to predict where they would be tomorrow, next week or even next month. The good news is there is plenty of good news to report.
“The recovery is stronger than what we could have anticipated, which is wonderful,” Elsea said on Friday. “We weren’t sure what was going to happen getting shut down for two months. But the market was strong enough before Covid and there was enough pent up demand that once we were allowed to open again the market moved very quickly.”
And while they still haven’t fully recovered the losses in March and April, Elsea believes that could happen over the course of the next few months if things continue on their current path.
“We have had two months in a row (June, July) of record months and it was really all the business we could handle,” he said. “If we continue this pace, by the end of the year, there is a chance we could make up the lost transactions.”
Elsea says the recovery is nationwide and not just an Ann Arbor or Michigan thing.
According to the National Association of Realtors, sales of existing homes soared 24.7 percent in July from June and the median price of a home sold in July rose 8.5 perent annually to $304,100. The supply of existing homes fell 21.1 percent annually, with 1.5 million homes for sale at the end of July.
“I don’t see that shortage of inventory will change much,” Elsea says of the supply of existing homes. “It might a little bit but we had a listings shortage even before Covid.”
Elsea says it’s a seller’s market right now in all price ranges.
“We don’t see this changing this year or next year,” he says. “What’s happening is most sellers have to buy a house so especially now if you’re moving up and buying a bigger house, now is the time to take advantage of the strong market and make that move.”