Earlier this year, realtor.com announced the release of the Housing Recovery Index, a weekly guide showing how the pandemic affected residential real estate. The index exploits a weighted average of four major components of the housing industry by tracking each of the following:
- Housing requirement – Growth in internet search activity
- Home Price – Increase in asking prices
- Housing supply – Growth of new lists
- Speed of Sales – Difference in time-on-market
The index compares the current state “To the January 2020 market trend, as a basis for pre-COVID market growth. The total index is set at 100 in this base period. The higher the index value of a market, the higher its recovery and vice versa. “
The chart below charts the index showing how the real estate market kicked off in early 2020, and then fell sharply in early March as the pandemic paused the economy. It also shows the strength of the recovery since the beginning of May.Today the index stands at its highest point all year round, including the time before the economic downturn.
The Impetus Is Still Being Built
Although there is some evidence that the overall economic recovery may be slowing, the housing market is still growing. Zillow tracks the number of homes that are contracted weekly. Ilia latest report confirms that buying demand continues to drastically exceed at the same time last year, and the percentage increase over last year is growing.Clearly, the housing market is not only surpassing the loss forecasts of earlier this year, but it is also surpassing last year’s actual success.
Frank Martell, President and CEO of CoreLogic, explains best:
“On an overall level, the housing economy remains solid despite the shock and respect of the pandemic. “
Whether you are considering buying or selling, staying up on the real estate market for the next few months will be essential to your success.
Content previously posted in Keep Current Things