Housing Prices Skyrocket Despite COVID-19 As Supply Remains Tight

By David Boraks
November 6, 2020

The coronavirus pandemic may still be a drag on parts of the economy, but home sales remain hot in North Carolina and nationwide. Strong demand from buyers and a shortage of houses for sale have sent home prices through the roof.

Real estate website Zillow reports that median sales prices nationwide have risen every week since May and are up 12.5% over this time last year.

In North Carolina, prices are up 10.8% in Charlotte and 13.6% in Raleigh compared with a year ago. Zillow senior economist Chris Glynn cites several factors:

“The first is historically low inventory. The second is extremely low interest rates. And the third is that households are reevaluating their housing needs in light of COVID-19,” he said.

Both Raleigh and Charlotte have about half the number of houses on the market this year as they did a year ago, according to Glynn. So even though prices are higher, homes are being snapped up super fast – typically six days, versus 11 days a year ago.

If you’re in the market to sell, the heavy demand is a good thing. But it’s a double-edged sword, Glynn said.

“It is a great time to be selling, in that you may have multiple offers or a lot of buyer interest in your home,” he said. “The counter side of that is that if you’re selling and then immediately needing to buy a house yourself, then you enter that same very competitive market.”

And that, Glynn said, is one of the reasons why there aren’t as many sellers right now. Other reasons Glynn cited: general uncertainty related to the pandemic and the perception that “they might be better off financially by waiting a year or two and continuing to let prices rise.”

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