Housing Demand Soars Past Pre-Pandemic Levels, Inventory Remains Tight

As states loosen their stay-at-home orders and Americans adjust to the new normal, housing demand has not just recovered: It has eclipsed pre-coronavirus levels. Demand is 5.5 percent higher pre-coronavirus levels on a seasonally-adjusted basis for the week ended May 10, according to Redfin. Low mortgage rates and the desire to escape the city are flaming the demand even as inventory remains sparse and the economy’s future path is uncertain. But as buyers return to the market, their checklists look different than before.

In the last five weeks, home-buying demand has come roaring back. For the seven days ended May 10, demand was 5.5% higher than it was before the pandemic, on a seasonally-adjusted basis.

The v-shaped recovery in home-buying demand is powered by record-low mortgage rates and the loosening of stay-at-home orders in some states. After two months of waiting for the other shoe to drop, buyers who are still employed may also be a little more confident about their job security.

But what buyers are looking for post-pandemic may not be what they were looking for before. MaryDell Penney, Redfin Market Manager in Central Florida said, “Pre-COVID people wanted a beautiful open floor plan. After a few months in quarantine, buyers want quiet spaces where they can actually get away from everyone else and dedicated space for school and work.”

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