Real Estate Recap: 2020 in Review
2020 was an unusual year to say the least! When it comes to real estate, we are officially in the middle of one of the strongest seller’s markets we’ve seen in years. Let’s take a look at the stats to see what that meant for the market in 2020 and where it leaves us now.
Covid took an already competitive market and pushed it further than we could’ve ever imagined thanks to an increase in buyer demand and a decrease in inventory and interest rates. When the lockdown began, many listings were pulled off the market or delayed, all while everyone was spending more time in their homes than ever before. With no where to spend their money, many people started thinking about renovating their current home or perhaps upgrading to a new one. Add them on top of the already massive subset of buyers who were ready to buy their first house (even more so now that they felt trapped in their current living situation) and you end up with a historic amount of buyers waiting to enter the market.
Finally, restrictions eased up and homes started hitting the market, but there just weren’t enough to satisfy the demand. Homes were selling left and right, often for way over asking price as buyers found themselves in bidding wars for a place to live. Let’s take a look at some of 2020’s stats to see what that really meant for the housing market:
2020 Housing Market Stats
These stats focus on the towns we are most familiar with:
Attleboro, Canton, Easton, Foxboro, Franklin, Mansfield, Norfolk, N. Attleboro, Norton, Plainville, Sharon, Stoughton & Wrentham
Single-family Homes
2020
Total Homes Sold: 2877
Average Days on Market: 44
Average Sale Price: $522,390
Sale Price to List Price Ratio: 101%
2019
Total Homes Sold: 2824
Average Days on Market: 56
Average Sale Price: $485,910
Sale Price to List Price Ratio: 99%
Condos
2020
Total Condos Sold: 1001
Average Days on Market: 47
Average Sale Price: $348,956
Sale Price to List Price Ratio: 101%
2019
Total Condos Sold: 927
Average Days on Market: 56
Average Sale Price: $309,347
Sale Price to List Price Ratio: 100%
The stats are a little surprising! Anecdotally, it felt like there were far less homes on the market last year than in 2019, but that wasn’t true. There were actually more homes sold in 2020, they just were on the market less time with a majority of them selling after their first showings or open house.
Price-wise, Massachusetts already high real estate values went even higher. Single-family homes and condos both saw about a 10% jump in values! On top of that, the average sale was closing for 101% of the list price (asking price). There were a lot of happy sellers out there!
Where do we stand now?
The market is still strong in the seller’s favor. In fact, inventory is lower than before thanks it being mid-winter. If you’re thinking about selling, now is a great time to learn what your home is worth. But keep in mind, getting a lot of money for your house is only part of the equation. You need to consider where you will go from there. May we suggest: Should you sell in a seller’s market?
You deserve a better real estate experience.
Should you sell in a seller's market?
We’re in one of the strongest seller’s markets in recent history and you’re thinking about selling your home because it’s appreciated in value quite a bit. Does it make sense? For some people it does and for others it doesn’t, let’s think it through…
Why do you want to sell?
My house is worth a lot and I’d like to cash in on that.
Your house is suddenly worth a lot of money, that’s great and all, but we do suggest that people don’t look at their primary residence as an investment. You’ll always need a place to live and if you sell in a seller’s market you’ll have to buy in a seller’s market. If you really want access to your equity think about what you’d use that money for. In many cases refinancing or utilizing a home equity loan is actually a better decision.
We’ve been wanting to upgrade our home or change towns and we want to sell while the value is high.
Well you can’t argue with that… So what now? You’re going to sell while values are high, but unfortunately that means you’ll have to buy high too. Can you avoid this?
Sometimes you can! Here are a few ways to sell high and avoid buying high so that you can save some of those profits:
Move to a lower cost of living area.
Planning to move out of state or to a different town? If the area has a lower cost of living than where you live currently then the decision is to sell is an easy one.
Downsize your home.
If you’re planning to downsize, that also makes the decision pretty easy. In this situation it’s likely that you’ll be able to purchase a new home and still save a good amount of the profits from your sale.
Find temporary housing.
If you’re looking to stay in the same area then you’ll need to wait for the market to cool down a bit. It’s hard to say when that will happen so now it’s you vs the clock. Do you have somewhere you can live in the meantime? Perhaps your family has an in-law apartment or maybe you sign a cheap lease for a year while you wait to see what the market does. Just make sure that your temporary housing costs don’t eat into your profits too much.
Say “heck it” and upgrade!
There’s nothing wrong with wanting to cash out your equity and use it all to upgrade your living situation. In fact, that is a great use of your home’s equity provided you can find a home that’s right for you. Keep in mind though, in a competitive market there’s a good chance you may have to win a bidding war. So take a look at your finances carefully to make sure that you don’t end up being forced to make a lateral move.
It can be a lot to think about so we’re here to help you weigh your options. Buying and selling real estate doesn’t have to be a stressful experience, in fact we work hard to make sure it’s as simple, stress free, and rewarding as possible.
You deserve a better real estate experience.
Winning a Bidding War
So you’ve found a home you like, but the problem is other people like it too, and now you’re in the dreaded bidding war. How do you win? Well in all honesty, you can’t always win these, sometimes there’s just a bigger fish. What you can always do is increase your odds. We make sure that all of our buyers put their best foot forward when it comes to submitting and offer and here’s how we do it.
How do you win the bid?
Become the strongest buyer you can be! The best odds are to be a cash buyer that can accommodate the seller’s timing and waive your home inspection (we don’t suggest this last part but technically that would make you a very strong buyer).
That’s a little unrealistic, right? Although there are people who fit that bill, 95% of buyers aren’t able to this. So what can you realistically do? Let’s break down the keys aspects of a winning offer:
Price
The best price is not always the winner, but ensuring that you can afford to bid above asking price is key. You can also sweeten the pot by saying you will cover any difference in appraisal value in cash.
Deposits & Down Payment
A bigger Purchase & Sale deposit and a larger down payment typically indicates a more serious buyer and less potential of financing issues.
Timing
The seller is almost always going to go with the buyer that can be flexible and accommodate their timing.
Contingencies
This is where the real difference is made assuming all of the bids are close in price. Who is going to be the easiest buyer to work with?
Mortgage Contingency
If you need a mortgage, this isn’t something you can avoid so you need to minimize a seller’s concerns. Offering well above asking price is an easy first step. After that make sure your mortgage pre-approval is thorough. Have your lender go through as much of the underwriting process as possible ahead of time so that you can show the seller that there is nothing to worry about money-wise.
Home Sale Contingency
Needing to sell your home before you can buy is a tough predicament when there are a lot of buyers out there who have nothing to sell, but it’s not a deal breaker. In this scenario we want to get a solid buyer under contract on your place with a contingency that you need to find suitable housing in order to close. This way we can show the sellers of your potential new home that we have minimized the risks of your home sale contingency as much as possible.
The other option is to just sell your home in advance and go into temporary housing to remove this issue all together.
Home Inspection Contingencies
We never recommend that a client waive their home inspection, especially on older homes, but some people who are competent with home maintenance feel comfortable doing so, especially in condos or newer houses. We suggest that our buyers say that they will cover X amount in home repair costs. This shows that you don’t intend to nickel and dime on the cost, you only want to know what you are getting yourself in to and reserve the right to walk away should any major issues be found.
Bonus: A Personal Touch
Stand apart from others by being yourself. Write the sellers a personal letter that gives them an idea of who you are and why you find their home so special. Including a photo helps bring it all together. Some people even go as far as to record a short video clip of themselves instead of writing a letter.
Ultimately we want to put ourselves in the seller’s shoes and think about what concerns they will have and how can we minimize them. Last year, we proudly found all of our buyers homes no matter what their circumstances were, and we’re excited to do the same for you!