Here are the Top July Real Estate Trends

Home | Here are the Top July Real Estate Trends

It’s no secret that real estate trends are frequently changing. Between the pandemic and inventory shortages, we’ve had an interesting year and a half when it comes to the housing market. With that being said, here are several things we know as it relates to real estate this month.

Homes are selling faster than ever

Inventory is low and demand is high, especially coming out of the pandemic with more and more people seeking to relocate or maybe even move back to where they left from last March. As a result, we’re seeing one of the most competitive housing markets our country’s ever seen.

According to data from Redfin, the average house is selling in a mere 18 days. At this same time last year, that’s 17 days shorter, making this the fastest pace ever recorded. In fact, 58% of listings are under contract in two weeks, and 45% are under contract in just one. Unfortunately, we don’t see this trend letting up any time soon as long as mortgage rates stay low. With that being said, there’s an advantage with the new home market. All over the Triangle, there are builders with homes available and you can see our entire list here.

Foreclosures and delinquencies are dropping

With various foreclosure bans and mortgage forbearance options still available, this one doesn’t come as a huge surprise. According to data, foreclosure filings dropped 1% from March to April and are now down 17% over the year.

On the other side, mortgage delinquencies have dropped 7.11% month over month. Today, fewer than 5% of mortgage loans are delinquent, which is the first time the share has been that low since the pandemic started. To take it a step further, serious delinquencies – or loans at least 90 days past due – dropped by 151,000 over the month, too.

Altogether, these stats signify the fact that there are fewer distressed properties, both today and in the immediate future. Remember, though: Forbearance options won’t last forever. Once borrowers start to run out the clock, the tables could turn — but only time will tell.

Housing affordability is on the downslide

According to the latest data from the Federal Housing Finance Agency, the more expensive price tags on homes aren’t going anywhere. The most recent FHFA House Price Index has prices up an entire 12.2% over the year. Even prices in historically low-cost zones are on the rise. In fact, 75% of these saw median home prices rise over the year, and a much smaller share of homes are under $150,000 in these areas.

Once you add in rising mortgage rates, affordability starts to slow considerably.

The Biden administration is setting its sights on housing

Housing issues have come front and center since the Biden administration took over, and we can expect to continue to see a trickle-down effect.

On the positive side, the SECURE Act will allow for remote notarizations (and hence, digital closings) nationwide. If passed, it’ll be a major win for investors, especially for those who live out of state.

There’s also the massive rental assistance measure passed as part of the American Rescue Plan in March. Though some states have been slow to disburse these funds, the bill allotted more than $21 billion to renters in need. It can be used toward past due rent, future rent, utilities, and more

All in all, the bottom line is that we still are uncertain about the future of the housing market as the United States starts to recover from the effects of COVID-19. We’re confident that Q3 and Q4 will give us a better understanding of what’s to come.