Against the Odds, Home Prices are Still Rising
Despite the coronavirus pandemic, a struggling economy, the highest unemployment rates since the Great Depression, and unrest throughout the nation — home prices increased 3.1% year over year last week and also increased in about 75% of the country's urban areas.
"There are still buyers in the market," says realtor.com® Senior Economist George Ratiu. "But given the very limited number of properties available, buyers are willing to pay more. The mix of homes that are on the market now is a little bit different. What's really selling at a premium are lower-priced homes. The higher-priced homes are sitting on the market longer."
Adding to the rise in cost, the number of new listings fell about 20% annually — decreased supply leading to increased demand and mortgage rates are still at a record-low. According to Mortgage News Daily, rates fell to 3.08% on 30-year fixed-rate loans.
"Homes that have been sitting on the market longer are good opportunities for negotiation," says Ratiu. "If buyers are not in a hurry, being patient is likely to pay off because we do expect more homes to go up for sale in the next few months."