What Recession? Summer Home-Buying Season Heats Up as Prices Surge.

By Clare Trapasso | Realtor.com on 6/11/2020

As the summer home-buying season gets underway, median home prices are surging. They shot up 4.3% year over year as the number of homes for sale continued to dry up in the week ending June 6, according to a recent realtor.com® report.

A deadly pandemic and a national reckoning on racism are not blunting the housing market's rebound.

As the summer home-buying season gets underway, median home prices are surging. They shot up 4.3% year over year as the number of homes for sale continued to dry up in the week ending June 6, according to a recent realtor.com® report.

The big surprise of the housing market is that prices have remained quite resilient," says realtor.com Senior Economist George Ratiu. He doesn't expect prices to drop over the next few months. “The summer housing market will be better than expected, but far off the normal pace.”

The culprit for the increasing prices: a lack of homes for sale and a rush of buyers. The total number of home listings on realtor.com was down 25% in the first week in June compared with the previous year—when there was also a housing shortage.

“The number of listings is shrinking at a faster pace, and it’s causing prices to go up,” says Ratiu. That's the exact opposite of the Great Recession, where a housing bust tanked the economy and home prices were slashed. "The [housing] market isn’t in the dire straits that it was the last time around.”  Meanwhile, buyers who still have jobs have been descending on the market en masse, enticed by record-low mortgage interest rates.

“For most people it will be a competitive buying market," says Lawrence Yun, chief economist of the National Association of Realtors®. “For lower-priced and medium-priced homes, multiple offers will be fairly common. On the luxury end, some price reduction will be required because there’s plentiful inventory.”

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