Pre-pandemic vs 2021 housing market

Dated: November 2 2021

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September housing data has a mix of good and bad news for homebuyers banking on a seasonal cooling in the housing market.

The good news: The housing market is following a normal pattern of seasonal cooling, which it did not follow in 2020.

The bad news: Although better than last year, this year’s wind-down has been lukewarm compared to historical norms.

Last year, pandemic shutdowns in spring caused homebuying activity to peak later in the summer and last longer into the fall. Year-over-year data shows that September home sales are down 5-8% from last year, but that says more about the abnormally busy 2020 fall market than it does about this year’s.

Due to the pandemic, 2020 data is unreliable for year-over-year comparisons. But the years prior provide a good baseline for measuring today’s market.

Pre-pandemic vs 2021 housing market

Compared to pre-pandemic years, the 2021 housing market peaked higher and is cooling at a much slower pace.

According to a RE/MAX National Housing Report, home sales and the median sales price dropped less from September-August 2021 than they did for the same time period for 2015-2019. Meanwhile, inventory declined more than it typically does in late summer-early fall.

Housing Market Indicator

September-August 2021

September-August 2015-2019 average

Drop in home sales

7.0%

15.3%

Drop in median sales price

1.1%

3.4%

Drop in inventory

4.9%

2.3%

Skewed year-over-year data shows September home sales down 4.2% from 2020, painting a picture of a slow 2021 market. However, before the pandemic home sales typically declined by 15.3% from August-September, but this year’s decline (7%) was less than half of the pre-pandemic norm. So although there were less sales than last year, this year’s market was significantly busier in September than a typical year.

This sustained demand coupled with low inventory kept prices from falling as much as they normally would in September. Inventory declined by more than twice the typical pre-pandemic rate and the median sales price dropped by a third of its normal rate from August to September.

In the report, RE/MAX President Nick Bailey said that next to 2020 — “which was an outlier in many ways” — this was the second-most active September in 14 years.

“Affordability remains a challenge in most metros, where tight inventory continues to push prices,” Bailey said. “Homebuilders are trying to fill the gap – especially with multi-family home construction – but many of them are held up by shortages in labor and materials. That said, the market’s still active – just not quite at the pace we saw earlier this year.”

Brought to you by Mike Bailey with Fairway Independant Mortgage

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Jerri Banner

I have been a Realtor for 23 years and a lifelong resident of the Triad area of NC. I am fortunate to work with my husband, Alan and my daughter, Kayla who grew up tagging along to showings and open ....

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