How is COVID-19 affecting the Valparaiso Real Estate Market?
Despite COVID-19, the real estate market in Valparaiso is as active as ever. Sure, there are several sellers who were planning to list in May who are now waiting until June to put their homes on the market. But even so, we went into the first quarter of this year with such momentum compared to 2019 that we have yet to see any serious effects that the virus is having on housing.
The main reason the real estate market has remained relatively unscathed during this time is because we simply do not have enough inventory. It all comes down to supply and demand. Due to low inventory over the last few years, demand is higher than ever. There are buyers who have been waiting for months to purchase and they are more than ready to pounce on that next home that hits the market.
Here is what is going on in the Valparaiso real estate market right now (May 7, 2020)
There are only 166 homes (single-family, duplex, condo, or townhome) on the market in Valparaiso right now. From January to April of this year, an average of 87 homes have sold each month. This means that if another home does not come on the market, we currently only have less than two months of inventory. The situation is similar in Porter County. There are only 338 homes on the market and an average of 166 homes are selling each month. At that rate, we have two months of inventory available. A normal market is considered to have four to six of inventory but when inventory is low, we consider it a seller’s market. The limited inventory paired with the lower interest rates we are seeing today makes it a good time to list.
Buyers these days are savvy. They know that with low interest rates and a volatile stock market, there aren’t investment opportunities much better than a home in a great community where average sales prices continue to go up. In the first quarter of 2019, the average sales price of a home was $244,213 compared to this year’s first quarter average sales price of $268,995. That’s a 10 percent increase over the course of one year! Year after year, we watch prices increase yet the number of homes sold stays the same. Coming back to supply and demand - it is because buyers have fewer homes on the market to choose from.
Some sellers who are pricing their homes right are seeing offers on their property during the first few days of the home being listed. This is happening more and more since pre-approved buyers have been diligently watching the market for the next home to be listed. As soon as it hits the market, they are quick to schedule a showing and make an offer. It is not unusual to get several offers on a property during the first few days it is listed while overpriced listings may sit on the market. Pricing a home right is key and it’s important becuase you don’t want it sitting on the market for a long period of time yet you don’t want to leave money on the table.
When all of this is said and done, I do believe there will be some effects on the housing market. Yet I think we will be better off than many other areas. We are fortunate to live in a smaller town that has a university and is so close to Chicago. I am proud to be a part of this community and hope that you are, too.
If you want to see what your home is worth, please contact me at 219-462-2090 ext. 210 or email me at email@example.com.
Century 21 Alliance Group