The Burke & Co. Weekly Market Report for Avalon, Sea Isle, and Stone Harbor– Week ending February 6, 2021
Burke & Co. is willing to step into the debate that’s bound to be the topic of conversation at every breakfast table and office water cooler today. Is the current sellers’ market at the NJ shore the “Greatest of All Time”?
Interest rates are lower than the obvious contender of 2006-2008. However, the more immediate and pressing factor that has created the intensity that buyers, sellers, and agents all feel is the incredible lack of inventory. Nobody seems willing to give up a second home while the COVID crisis continues.
It will be very interesting to see how both the fall and spring markets of the future will be. It’s possible there is “pent up demand” on the sell side. That concept is usually applied when discussing buyers, but current circumstances might warrant a discussion of the idea that sellers have been reluctant to list and sell homes for a few reasons. First, selling is less convenient during COVID and there is at least a small but substantial portion of any population with legitimate concerns in this crisis about the idea of scores of people coming through a home. Secondly, travel has been almost entirely eliminated as an option. This has made second home owners far less likely to sell. “We loved the house but realized that it became all we did for vacation, so we’re selling it and taking the whole family to Europe (or Japan or Fiji or New Zealand or some other destination)” ranks surprisingly high as the reason sellers finally decide to give up a house they love. And finally, there’s the vicious cycle of some potential sellers who are ready for vacation homes bigger, or newer, or closer to the beach or bay, finding the lack of inventory depressing to the prospects of selling a current home and pursuing that goal.
When the levee breaks, water rushes. It’s imaginable that even without a deep financial crisis (let alone a specifically real estate created one like in 2008) we could see the market snap dramatically in the other direction on the other side of summer 2021. We should have large scale immunizations by that point and a return to–if not a pre-COVID normalcy– at least a new normalcy. The crazy recent phenomenon of a sea of buyers shopping for homes largely because they have nothing better to do with their money right now might might dry up. Old options will return and the onrush of waters from many home owners now re-assessing the situation and planning to sell could flood those empty stretches with far more homes than we’ve seen on the market in several years.
A snap phenomenon like that without some other more radical overall economic occurrence would be a novel development. It might be hard to point to a specific precedent. However, if 2020-2021 has taught us anything, it’s that there can be great wisdom in assessing the current environment and anticipating how it might result in novel events.
Fall 2020 and spring 2021 sellers might smile for being the few wise to be in front of that tide. At least for a couple or a few years.
If you are ready to start your plans to buy or sell, call us at our team line at 609-478-0333 or email [email protected]
And of course, take a look at all of this weeks new listings, under contract, and sold homes with these links.