We are Experiencing a Deferred Spring Market
June 29, 2020 Source: Robert Reffkin, CEO Compass
I believe we’ll see more transaction volume
over the next 18 months
then we did over the last 18 months.
I believe this summer
will have more real estate activity
than any summer in the history of real estate.
- The real estate market has already hit bottom and started bouncing back. Over the last 3 weeks or so, in almost every one of our markets, we’ve started seeing a meaningful increase in pending / in-contract and new listings activity.
- Catastrophes create movement. After 9/11, things froze in NY for three months, but when it bounced back, it was bigger than ever before. People who were living downtown wanted to move uptown. People who lived in Manhattan who wanted to live in other boroughs. People in all of New York City who wanted to move to New Jersey or Connecticut. It created movement — and this moment will be no different.
- Your clients have never been so intimately aware of the inadequacies of their home. We’ve effectively had a trillion-dollar free advertising campaign, to every one of your clients, saying, “Do you have enough indoor space? Outdoor space? Bedrooms? Do you have the right home office setup? If the answer to any of these questions is ‘No,’ go call your agent.”
- Buyer demand is strong. Buyers are seeing record-low interest rates, and have a sense that now’s a good time to get a good price. I don’t know a buyer who’s saying, “Let me wait two years to lock in a really good price.” It’s still to be seen whether this increased demand is larger than the impact of the 20 million Americans who’ve lost their jobs in the last two months. But looking at the data, our company’s client base has disproportionately not been impacted economically.
- Summer is the new spring. Summers are normally slower because a lot of inventory sells in the spring, and because many people are on vacations. Not this year. The spring market wasn’t eliminated, it was deferred. That inventory is still going to come. And everyone’s canceling their international vacations.
- For the first time at Compass, I have heard of dozens of cases where buyers can’t even get appointments with agents because they are so busy.