In the real estate industry, one of the more surprising things that have emerged from the Covid-19 era has been the direction of the housing market. There were many speculations early on about whether it would cause a buyer’s or a seller’s market since many factors were at play. For the people looking to escape more urban areas, the need to seek more suburban properties would organically drive prices up if supply stayed the same. On the other hand, people who were in a hurry to downsize might be reducing their sale prices for quicker transitions elsewhere. If they didn’t have a lot of demand for their home, they might settle for a lower bid. 

For starters, the housing market was already favoring sellers before the pandemic. In February, there was a natural regression when it came to potential buyers because many people were taking a wait-and-see approach. As time has gone on, however, people have decided to move ahead with their existing home-buying plans, with some people even speeding up their decisions to relocate. Some experts say that while it is still in the hands of the sellers, that trend may be slowing down. Others say that the pent-up demand has caused a surge in activity that looks to continue well into 2021. According to Realtor.com, it has only taken four months for the market to return to the normal pace of growth pre-pandemic. Heavy buyer competition paired with a significant shortage of supply has brought us to where we currently stand. For a seller, this is great news. Buyers are reporting that homes are being purchased at a rate too fast to compete with, some within 48 hours of going on the market. 

Human nature states that people are generally cautious in times of uncertainty. This would imply that it’s logical for potential buyers to be hesitant. However, due to a number of factors including record-breaking low mortgage rates, they also have the opportunity to lock-in low mortgage payments if they act soon. The question on everyone’s mind is how long this bubble will last. If the past is any indication, we can be fairly certain that any industry bubble will eventually burst since it can’t be sustained indefinitely. There is just no indication yet of when this could happen.