In this weeks COVID-19 update, from the REALTOR.com YouTube channel, Chief Economist Danielle Hale discusses the one year anniversary of the pandemic declaration, the stimulus package, new jobless claims and vaccine progress. In short, we continue to make progress, but there’s still a long way to go.
We saw mortgage rates rise this week, and in our latest Weekly Housing Trends View and Housing Market Recovery Index courtesy of Sabrina Speianu we look at how housing has changed over the last year. The housing market bounced back so much faster than other sectors of the economy that many have forgotten that housing activity slowed to a crawl during the early days of the pandemic.
While the market is recovered in nearly every respect, the housing component that has been the most challenged is supply, and the lopsided momentum created by surging buyer interest and lagging seller activity continues to mean a competitive housing market.
Remote workers seeking space for offices and a simpler lifestyle are searching for homes in places like Lake Tahoe, Santa Cruz and Cape Cod. Meanwhile, big cities like New York are cooling down.
Seattle, WA – March 10, 2021 (PRNewswire) — (NASDAQ: RDFN) — Housing markets in vacation destinations and relatively affordable suburbs of big cities have heated up more than any other area over the last year, a time period that starts with the onset of the coronavirus pandemic in the U.S., according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Places like Lake Tahoe, Cape Cod, and suburbs of Chicago and New York City are gaining popularity as homebuyers take advantage of remote-work policies to prioritize affordability and personal preferences like proximity to nature and recreation over living near the office.
This is according to a Redfin analysis of the 10 U.S. housing markets that have heated up most over the past year, and the 10 that have cooled down most. Redfin’s ranking is based on year-over-year change in home prices, home sales, the share of homes that sold above their list price, the speed of home sales and Redfin.com searches.
Vacation towns and suburbs are heating up most
El Dorado County, CA—an area that spans from the eastern outskirts of Sacramento to the southern part of Lake Tahoe—is number one in Redfin’s ranking, with measures of homebuyer competition growing more than any other U.S. county over the last year. Home prices increased 36% year over year in January, and the median number of days on market fell 50 days from the year before.
“Parts of El Dorado County, like Lake Tahoe and the upscale community of El Dorado Hills, have been hot throughout the pandemic, partly thanks to remote work,” said local Redfin agent Ellie Ruiz Hitchcock. “About half of buyers in El Dorado Hills are coming from the Bay Area and half are locals, including people coming from neighboring Sacramento, who are upgrading their homes. Tech workers moving out of Silicon Valley are seeking larger homes, more overall space and simpler lifestyle at a fraction of the cost. Most homes in the area are receiving multiple offers.”
U.S. counties that have heated up the most (January 2020 to January 2021)
Rank
U.S. county
Parent metro area
Median sale price
Median sale price, YoY change
Median days on market
Median days on market, YoY change (in days)
Share of homes that sold above list price
Net inflow of Redfin.com users searching in the area
1
El Dorado County, CA (Lake Tahoe)
Sacramento, CA
$592,500
36%
25
-50
37.4%
2199
2
Santa Cruz County, CA
Santa Cruz, CA
$1,000,000
18%
38
-50
49.7%
720
3
Deschutes County, OR (Bend)
Bend, OR
$509,450
24%
8
-66
43%
1818
4
Kendall County, IL
Elgin, IL
$274,500
22%
16
-54
31.8%
365
5
Barnstable County, MA (Cape Cod)
Barnstable Town, MA
$514,875
31%
24
-46
36.7%
1953
6
Charles County, MD
Washington, DC
$350,000
21%
25
-38
44.4%
810
7
Burlington County, NJ
Camden, NJ
$264,000
23%
32
-34
37.6%
299
8
Frederick County, MD
Frederick, MD
$375,000
19%
27
-27
39.5%
1188
9
Ocean County, NJ (Jersey Shore)
New Brunswick, NJ
$339,950
31%
34
-40
36.3%
683
10
Orange County, NY
Poughkeepsie, NY
$344,950
29%
46
-29
40.7%
1191
Expensive East Coast job centers are cooling down
Arlington County, VA, home of Amazon’s second headquarters in Crystal City, is ranked number one on the list of housing markets that cooled down most from January 2020 to January 2021. But the housing market is so hot throughout most of the country that even in the market cooling most, prices are up 4% from last year, and 23% of homes are selling above list price.
That’s an about-face from late 2018, 2019 and early 2020, when homebuyer interest in the areas surrounding Crystal City skyrocketed after Amazon’s HQ2 announcement. But with the surge in remote work over the past year, living close to the office isn’t as important as it once was and housing markets in expensive job centers are suffering. The cooldown in Arlington County is particularly drastic because it was skyrocketing a year ago, just before the onset of the pandemic. It’s also worth noting that Charles County, MD and Frederick County, MD, both part of the Washington, D.C. metro and home to farther-flung D.C. suburbs, are both on the list of places heating up most.
COVID-19 has changed a lot of things about daily life, including how to go about finding and buying a home. Even for non first time home buyers, here’s what you should know.
In the best of times, house hunting is a complicated and involved process—a big-ticket proposition involving lots of shopping around and meeting a ton of people so you’re 100% sure you’ve picked the right place, at the right price. But, of course, these are not the best of times, and in the following video, from the REALTOR.COM YouTube channel, we learn more.
Now that the coronavirus pandemic has people across the country hunkering down at home to lower their exposure levels, even the most determined home buyer might be wondering: is buying a house safe right now?
