We love the ‘burbs! One explanation as to why our pricing has been stout:
If millennials once piled into the cities, fueling downtown renewal and growth, apparently they are now piling out.
The stay-at-home orders brought on by coronavirus have more potential homebuyers looking for properties in the suburbs. Millennials are now the largest cohort of buyers.
As the real estate market began to recover in May, home searches in suburban zip codes jumped 13%, according to realtor.com, one of the largest real estate listing websites. That doubled the pace of growth in urban areas.
While homes are spending more time on the market overall, due to complications surrounding closings, both suburban and rural markets are not experiencing that lag time as much, due to very strong demand.
“This migration to the suburbs is not a new trend, but it has become more pronounced this spring,” said Javier Vivas, realtor.com director of economic research. “After several months of shelter-in-place orders, the desire to have more space and the potential for more people to work remotely are likely two of the factors contributing to the popularity of the burbs.”
More than half of the nation’s 100 largest metropolitan areas are seeing increased interest in the suburbs. Real estate agents in the New York City area have reported strong demand in the surrounding suburbs, as contracts on Manhattan apartments plunged 80% annually in May, according to Jonathan Miller of real estate appraisal firm Miller Samuel.
This new flight to the suburbs is clearly benefiting the nation’s homebuilders, who have seen a much quicker recovery than they ever expected.
“There’s no question that there are people who are fleeing the cities. There’s no question that the second home has been a place of refuge. There’s no question people are rethinking whether they want to be in high rise rentals with common spaces as amenities vs. having a home of their own with a backyard,” said Stuart Miller, chairman and former CEO of Miami-based Lennar.
https://www.cnbc.com/2020/06/18/coronavirus-update-people-flee-cities-to-live-in-suburbs.html
> “There’s no question that there are people who are fleeing the cities. There’s no question that the second home has been a place of refuge. There’s no question people are rethinking whether they want to be in high rise rentals with common spaces as amenities vs. having a home of their own with a backyard,” said Stuart Miller, chairman and former CEO of Miami-based Lennar.
A poster on my blog mentioned that Ventura County beach communities are being flooded by would-be Los Angeles escapees looking for second homes.
The second part is just “natural demographics.” Kids in a condo just isn’t what people want.
Imagine the issues my eldest is now facing. Everything was all planned out. Time off arranged. Careers dovetailed. Then… twins. Life blows up the best made plans. Suddenly the pleasant townhome in Woodland between their jobs is barely workable. Time to seek out that white picket fence.
How many have been fully prepared for what they would do in a pandemic?
How many people have had to handle a major disruption in their life?
Most of us don’t have a lot of experience with handling unexpected and life-changing events. You would think there would be a lengthy pause to re-calibrate? But real estate sure has bounced back quickly!
For those who are still waiting for the bottom to fall out……
In an effort to keep homeowners and renters in their homes as they navigate the economic fallout of the coronavirus pandemic, federal foreclosure and eviction moratoriums are being extended for two more months.
Freddie Mac and Fannie Mae will extend the moratorium on foreclosures and evictions on single-family homes until August 31. The protections were originally set to expire on June 30.
In addition, the US Department of Housing and Urban Development will extend Federal Housing Administration loan forgiveness for homeowners with FHA-insured single-family mortgages until the end of August. The program was put in place in March with a 60-day moratorium and was later extended until the end of June.
“While the economic recovery is already underway, many American families still need more time and assistance to regain their financial footing,” said Ben Carson, the Secretary of HUD. “Our foreclosure and eviction extension means that these families will not have to worry about losing their home as they work to recover from the financial impacts of Covid-19.”
Servicers must continue to halt new foreclosure actions and suspend foreclosure actions that were in process, as well as cease evictions of people renting FHA-backed single family properties. The only exception to the stay is for occupants of legally vacant or abandoned properties.
https://www.cnn.com/2020/06/17/success/fha-eviction-and-foreclosure-moratorium-extended/index.html
The “peaceful” protests will only add fuel to this trend.
Anyone thinking the bottom will fall out doesn’t understand politics.