Learn how national real estate trends align with what’s happening in Delaware real estate during the Coronavirus pandemic plus our 2021 market predictions.
All real estate is local, but amid this pandemic, certain national trends are also true here in Delaware. Lawrence Yun, Chief Economist and Senior Vice President, Research, National Association of Realtors, was the featured speaker at the Delaware Association of Realtors Broker Summit, September 16, 2020. Here are just a few highlights of his report:
- Existing home sales nationally are up nearly 10% year-over-year
- New home sales nationally are also up more than 10% year-over-year
- Pending contracts are up more than 10% year-over-year
Our friends in the local mortgage industry have been even busier. According to Yun, mortgage applications to buy a home are up 30% year-over-year! Mortgage rates remain historically very low with rates as low as 2.8% in August of 2020 for a 30-year fixed mortgage.
These low rates have contributed to the increased rate of homeownership for all groups. The spike may not be as high as it appears, however, due to issues caused by COVID with the current census, causing the data to be skewed toward homeownership.
In response to COVID, people are fleeing the cities and resort communities and creating the strongest demand in the suburbs and rural areas, where they are buying larger homes in subdivisions.
Coincidentally, Delaware is benefitting from the transition from densely populated cities and metropolitan areas in the Mid-Atlantic and Northeast, despite being home to many popular beach resorts. It does reflect anecdotal evidence that many of our buyers are moving here for the overall quality of life and not as many are buying homes “at the beach.” They are buying homes in our many new home communities or subdivisions sprinkled throughout Sussex County and even into Kent and New Castle County.
More people are now working from home and Delaware again is a beneficiary of that trend with our location so close to the major work centers.
Home prices continue to rise
Nationally, home prices are up 3-5% in 2020 and are expected to go up another 2-3% in 2021. Home sales in 2020 are up between 0–3% and forecasted to go up another 6–10% in 2021.
Again, in Delaware, the increases have been steeper. Despite the initial reaction to COVID in March, April, and May, our sales at Active Adults Realty have gone through the roof. It now appears we are 10% ahead of last year, and last year was 21% ahead of 2018.
In summary, Dr. Yun said that this year is surpassing all his expectations despite the scary times when we were put in lockdown. Unexpected events come at us periodically but we have always come back stronger. He is encouraged and feels that the strong real estate market will continue into 2021 fueled by the pent-up demand to move and the increased rate of savings that occurred as most of us just stayed home.
The team at Active Adults Realty stands ready to assist you with listing your home or helping buyers find a great location. Schedule an appointment today to discuss the possibilities. If your plans include relocating to the great state of Delaware, we invite you to download our complimentary relocation guide.