Homebuyers continue to boost local housing trends, picking up new homes and taking advantage of low interest rates despite pandemic worries, making the Southeastern Michigan housing market one of the hottest in the nation.
On Monday, the Greater Metropolitan Association of Realtors, an industry group also known as GMAR based in Southfield, reported that October continued to be busier despite the pandemic or the fall weather.
“Buyer activity remains higher than normal for this time of year, while in many segments of the market housing supply remains much lower than one year ago. Multiple offers remain a common occurrence in many areas, keeping housing hot while the temperatures continue to fall,” the report said.
GMAR’s report noted that closed sales increased 19.1% for residential homes and 15.5 percent for condo homes. Pending sales increased 16.2% for residential homes and 18% for condo homes.
The median sales price increased 16% to $210,000 for residential homes and 5.9% to $180,000 for condo homes. Days on Market decreased 14.3% for residential homes and 2.4% for condo homes.
“Mortgage rates dropped to new record lows again in October, helping to offset the monthly mortgage payment increases caused by the rise in home prices seen in many segments of the market across the country. While prices often dip a bit in the winter months, continued buyer demand may temper any price retreats this year,” the report found.
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Year over year, GMAR’s report said that new listings were down 10.1% from 11,744 to 10,561. Pending sales were up 16.4% from 7,663 to 8,922. Median Sales Price was up 13.9% from $180,000 to $205,000. Months’ supply of inventory was down 41.2% from 3.4 to 2. And the average showings per home increased from 5.6 to 10
Southeastern Michigan impact
Home sales are skyrocketing throughout metro Detroit, according to the latest RE/MAX of Southeastern Michigan Housing Report, which was issued Nov. 25. Home sales are up 14.6% over last year and prices are up 16.7%, according to Jeanette Schneider, executive vice president of RE/MAX of Southeastern Michigan.
“The market moved at a brisk pace in October with buyers taking advantage of historically low interest rates and mild weather to look for a new home,” Schneider said. “Whether it is a dedicated home office or simply more space in general, buyers continue to be out in force looking a home that meets their new needs.”
That is why this continues to be what Schneider called a sellers’ market.
“Sellers who have always dreamed of a time where they could sell their home quickly and primarily on their terms will enjoy our current environment,” she added.
Additional takeaways from the latest report include:
• Livingston County saw the largest jump in home sales at 21.3%.
• Macomb County saw the largest jump in home prices at 21.5%.
• Homes are selling the fastest in Macomb County and are on the market for an average of 31 days.
For overall home sales, there were 5,609 homes in the Southeastern Michigan area sold during October 2020 compared to 4,893 at the same time last year. That is up from the 4,659 homes sold in September, the report said. The median sales price was $237,250 in October 2020 compared to $203,250 at the same time last year.
Days on the market went from 42 average days in October 2019 to 36 days in October 2020. The “months’ supply” or availability of homes for sale was 2.7 months in September 2019 but only 1.2 months in October 2020, the report said. A supply of six months is considered balanced and more the norm, the report noted.
Nationally, home sales are up 20.8% year over year. The median sales price is $295,000 or up 15.4 % year over year. The average days on market is 38, down 11 days from 2019. And the months’ supply of inventory is 1.7 months. This data comes from 54 metro areas across the country as reported in the Housing Report.
Other home and housing-market industry leaders also have been reporting record numbers because of the high interest in moving homes, refinancing a mortgage, getting a mortgage for the first time or related business.
In November, Rocket Mortgage, America’s largest mortgage lender, and Amrock, one of the nation’s largest providers of title insurance, property valuations and settlement services, reported that the two companies delivered 90% of all digital closings with eNotes through the first three quarters of 2020.
More importantly, in just the first nine months of 2020, Rocket Mortgage and Amrock, both of which are subsidiaries of Rocket Companies, have more than doubled the number of digital closings they completed in all of 2019. The growth of eClosings was accelerated by the COVID-19 pandemic and demand from clients, according to a company media release.
Rocket Mortgage officials said that “digitizing the mortgage experience and removing manual steps in the closing process increases efficiency, ensures that every transaction is consistent and reduces opportunities for human error – such as missing signatures on the closing documents, which is one of the most common closing errors.”
In 2019, Rocket Mortgage became the first mortgage lender to offer digital closings nationwide. Continuing to build on their heritage of innovation, Rocket Mortgage and Amrock partnered in July to complete North Carolina’s first-ever RON closing.
However, one industry that continues to struggle during the pandemic is the hotel and hospitality industry. With a resurgence of COVID-19 and renewed travel restrictions enacted in many states, a new survey of American Hotel & Lodging Association (AHLA) members shows that the hotel industry will continue to face devastation and significant job loss without additional relief from Congress.
Seven in 10 hoteliers (71%) said they won’t make it another six months without further federal assistance given current and projected travel demand, and 77% of hotels report they will be forced to lay off more workers. Without further government assistance (i.e. second PPP loan, expansion of Main Street Lending Program), nearly half (47%) of respondents indicated they would be forced to close hotels. More than one-third of hotels will be facing bankruptcy or be forced to sell by the end of 2020.