After 30 years of real estate management and teaching the business to hundreds of agents, I now focus solely on helping my clients buy and sell homes. But now I also have time to share my experiences and knowledge with you, the readers of Lowell’s First Look, on a monthly basis. I invite your ongoing questions, whether you are planning on purchasing your very first home or your next home, or your last home. Just email me your questions at [email protected].
Real Estate Headed in the Right Direction
Contrary to the COVID-19 numbers in many areas of the country, the real estate numbers in West Michigan are looking positive. The real estate industry continues to use Best Practices in COVID-19 prevention, as we move forward with the summer market. We listen to the sellers of properties and engage their wishes of safety levels, whether it be facemasks, sanitizing wipes, physical distancing, shoe covering booties, gloves, or a combination of efforts. In-person open houses have returned, but they carry some restrictions as to the number of visitors in the home at the same time. Most buyers are indicating their desire to provide the same safety measures for themselves. Therefore, Realtors are engaged with safety first, as we move forward with our daily duties.
Even though the real estate market is headed in the right direction, Governor Whitmer signed Executive Order 2020-147 this past Friday. This order reiterates the previous requirement that individuals are required to wear a face covering whenever they are in an indoor public space. It also requires the use of face coverings in crowded outdoor spaces. We were certainly hoping to continue with less restrictions, rather than go backward. We are all hoping it stays that way, as America is counting on the return to a normal economy and more jobs for the unemployed.
The Market Demand
As I reported last month, the demand from buyers after the lockdown began very strong. The pent-up buyer interest from the lock-down, coupled with new buyers entering the marketplace, has been stronger than anticipated. Multiple offer situations picked up, right where they left off, and the pending sales have been piling up. Let’s face it, there are normal desires to move and then there are needed reasons to move. Purchasing a home is an American Dream that still holds true. West Michigan is a desirable place to live, work and raise a family and homebuyers are proving that point with their home purchasing activity.
It seems that the housing demand is well covered by all the generations, with first-time buyers still leading the way. Of course, the Millennials are still providing the biggest demand, but there are plenty of Baby Boomers and Generation X participation with condo sales and move-up larger home sales.
Again, properly priced listings are selling quickly and many with multiple offers. West Michigan has not missed a beat. The homes are selling and the increase in closed transactions is coming.
The Market Inventory
The inventory remains very low. This is one of the reasons causing quick sales and multiple offers. When a new listing hits the market, there are several buyers interested at the same time. With such a shortage of available homes, buyers are making quicker decisions and being less picky about certain desired amenities. the current housing environment surely indicates it is truly a great time to sell a home.
The market is still depending on Baby Boomers buying condos or smaller homes and selling their larger homes for the younger growing families that need the space. This is the natural market process of evolving supply and demand. I believe that inventory will continue to grow steadily through the remainder of 2020.
The Numbers – Greater Regional Alliance of Realtors (GRAR)
TOTAL STATS FOR COVID PERIOD TO DATE 2020 vs. 2019* – Real Estate Activity
| Period | New Listings | Pending Sales | Closed Sales |
| 5/7/20 – 6/24/20 | 2,491 | 2,635 | 1,271 |
| 5/9/19 – 6/26/19 | 2,666 | 2,369 | 2,011 |
| Year Over Year % | – 6.6% | + 11.2% | -36.8% |
*Coverage area includes all of Kent and Ionia Counties, northern Barry County (inclusive of Gun Lake) and southeastern Ottawa County.
Lowell School District
| Period | Sales Closed | Ave. Sale Price | Median Sale Price |
| 1/1/20 – 6/30/20 | 130 | $296,199 | $252,000 |
| 1/1/19 – 6/30/19 | 133 | $289,577 | $251,000 |
| Year Over Year % | -2.3% | +2.3% | +.4% |
As the numbers tell us, West Michigan has shown tremendous housing market strength. Closed transactions will always lag behind pending sales by about 30 days. If the 2020 pending sales continue to out-pace 2019 numbers, closed transactions may very well reach and potentially surpass 2020 numbers by year-end. This may not be true in other parts of the country, but West Michigan is showing the strength to do so. As you can see, the Lowell School District is outperforming the total West Michigan market, as one of the higher demand markets around metropolitan Grand Rapids. By the time you read this, 2020 sales closed in the Lowell School District will have the 2019 pace.
Down the Long and Winding Road
It has been reported that home showings around the country are as strong right now, as the same comparable period last year. Most predictions did not anticipate quite as much activity, forecasting a slower recovery.
Keep in mind, a full housing recovery may have a bumpy road ahead, as there are 45 million people still unemployed. 11% unemployment is a far distance from 3%. Unfortunately, this will not reduce and normalize overnight. Those 45 million people will not be buying homes anytime soon. It is also expected that there will be a sizable number of white-collar and management positions that will be lost and added to those that are unemployed.
There are many national housing recovery predictions. There are some that believe 2020 will end with slight increases over last year and some as much as 20% down. Some believe a full recovery won’t happen until 2021. I believe West Michigan will have positive housing numbers on 2020, but with less units sold, but more sales volume. Average sale prices will increase in many areas, including the Lowell School District. In conclusion, this may be a rare time in the marketplace when low inventory is providing for a seller’s market, but with the demand causing increasing sale prices, it may also be a good time to buy a home, if prices continue to rise.
Rick Seese works with buyers and sellers of residential, commercial and industrial real estate. He is an Associate Broker with Greenridge Realty, Inc. and has been licensed full-time for 43 years. If you’re interested in reaching out to Rick for more information, or have a question for the monthly article, you can contact him via email ([email protected]), visit his website at www.rickseese.com or Facebook page at (www.facebook.com/Rick Seese), or call/text him at 616-437-2576.
Rick,
Thank you for that clarification and especially your support for wearing masks. I did misunderstand your intent as I focused on the word “backwards.” I’m living in South Carolina right now where politics have intersected with rational thinking leaving a wake of destruction from misguided protests, mindless rebellion and a sharp increase in Covid sickness. I hope my comments did you no harm.
Ana Dunn
Ana-
I believe you may have misread or misinterpreted the intent of the sentence regarding the requirements of masks. My apologies if it wasn’t clear, but I am in full support of wearing masks to slow the spread of Covid-19. Safety is the foremost concern of the real estate industry, and safety remains my priority and the priority of our profession. Wearing masks has been highlighted as the most effective means of containing the spread of the virus and using them allows businesses to remain open, which I know is important for those who have expressed concern about the economy. We were merely hoping that the Covid-19 numbers would have continued to decrease so we could continue with less concerns. However, that has not happened and therefore, we have gone backwards. Again, sorry for the misunderstanding. I would be happy to discuss this further and answer any additional questions you may have.
Sincerely,
Rick Seese 616-437-2576
“Even though the real estate market is headed in the right direction, Governor Whitmer signed Executive Order 2020-147 this past Friday. This order reiterates the previous requirement that individuals are required to wear a face covering whenever they are in an indoor public space. It also requires the use of face coverings in crowded outdoor spaces. We were certainly hoping to continue with less restrictions, rather than go backward.”
So, are you saying that requiring face masks is going backwards? If so, I surely would not want to hire you as my realtor because that would make me feel like the transaction is more important than public safety. Look at the increase in Covid cases in Michigan that arose immediately after restrictions were eased up. That is why a “backwards” order was necessary. Take a lesson from South Carolina, Arizona and Texas. Wear your mask and be supportive of your governor.