Nick looks at what many experts are saying in regards to home prices as we enter into the second part of 2020. He also explains the unique aspects of the Boston real estate market and what buyers and sellers can expect if they plan to make a real estate transaction through the end of the year.
In a recent blog post, we looked at what many experts are saying about future home prices. What do you think about their predictions?
While I don't have a crystal ball, the lack of inventory due to the pandemic in most major markets across the country has caused a bit of an imbalance in supply and demand. In the Boston area, we are already seeing a buyer feeding frenzy in many locations and more specifically in certain price-points. As things slowly return to normal, more and more sellers should gain confidence and put their properties on the market which should help create more balance in the market. However, I don’t think it will be enough to satisfy overall demand so I would expect real estate values to continue to rise in 2020, but most likely at a slower rate when compared to previous years mainly due to the lingering uncertainty around COVID-19.
Looking at the Boston market specifically, what do you think we can expect for home prices in the second half of 2020?
I’m cautiously optimistic about the second half of 2020. Our spring market was put on hold due to COVID-19 but now, as restrictions are lifting, we are seeing sellers return to the market. Normally, July and August are very slow but this year I expect them to act as a late spring market which should continue straight into the traditional fall market. This pent up demand has resulted in some markets and neighborhoods seeing bidding wars again which will continue to drive pricing upwards.
One thing to make note of is that this is an election year which typically affects the real estate market. Historically, we’ve seen buyers and sellers temporarily pause a few weeks prior to an election so our fall market could be cut a bit short compared to normal years but should come back strong in early 2021.
The reason I said I was “cautiously” optimistic is that this is all contingent upon the cases of the virus continuing to decline and no additional lock down orders being put in place. As of right now everything is trending that way but we have to remain vigilant and continue to follow the proper precautions to make sure it stays that way.
What advice do you have for sellers looking to sell their home this year?
This Summer's real estate market is going to look different compared to what we are used to. I would normally advise clients, if they have the flexibility, to either list in the spring or fall to take advantage of the market but since our spring market essentially did not happen, the demand expected this July and August should make it a great time to sell.
We are still seeing low inventory across the board so the lack of competition should help most sellers get a good price. With that said, this doesn’t mean that sellers can get any price they want. They should still be working with their agent to develop a pricing strategy that positions them correctly within their market to generate enough activity that will result in a strong offer.