Earlier this month, realtor.com announced the release of their initial Housing Recovery Index, a weekly guide showing how the pandemic has impacted the residential real estate market. The index leverages a weighted average of four key components of the national housing industry, tracking each of the following:

1. Housing Demand – Growth in online search activity
2. Home Price– Growth in asking prices
3. Housing Supply– Growth of new listings
4. Pace of Sales– Difference in time-on-market

The index then compares the current status “to the last week of January 2020 market trend, as a baseline for pre-COVID market growth. The overall index is set to 100 in this baseline period. The higher a market’s index value, the higher its recovery and vice versa.”

The graph below charts the index by showing how the real estate market started out strong in early 2020, and then dropped dramatically at the beginning of March when the pandemic paused the economy. It also shows the strength of the recovery since the beginning of May.It’s clear to see that the housing market is showing promising signs of recovery from the deep economic cuts we experienced earlier this spring. As noted by Dean Mon, Chairman of the National Association of Home Builders (NAHB):

“As the nation reopens, housing is well-positioned to lead the economy forward.”

The national data today indicates the housing market is already on the way up. The showing data for Connecticut is showing an even more pronounced V shaped recovery. The showing traffic in Connecticut is now surpassing this year’s pre-pandemic peak by 21.6% and the local showing traffic is 36.9% above what it was during the same time last year. The local Market data is showing:

1. Housing Demand Up– Growth in booked showings
2. Home Prices Up – Growth in asking and sales prices
3. Housing Supply Down – Decrease of new listings coming to market
4. Pace of Sales Up – Number of Days homes on the market decreasing

Local Bottom Line

These graphs show that there is a Covid-19 squeeze effect happening now in West Hartford, as in many other towns in the area.  It’s a Seller’s Market; Buyers are feeling it, and in response showing traffic is going through the roof and many homes are selling as soon as they hit the market. The median Days on Market for single family homes is down to 41 days – That’s incredible.  Adding fuel to the squeeze effect, mortgage rates are at an all-time low.  Furthermore, Sellers are just not putting their houses on the market in large enough numbers to meet the demand, with many additional Buyers coming in from the cities to find properties in less crowded areas where they can safely work from home.  The continued low housing supply, down in West Hartford almost 20% from last year, and an increase in multiple offers and quick sales have led to higher home prices.  Due to this unique situation caused by Covid-19, there is an unusual Spring-time energy to this Summer-time Market.  If you are thinking of selling in our area, you could easily find yourself with multiple offers, close to or over asking, with few, or even no contingencies.  Sellers have not been in such a favorable a Market since before 2008!

Staying connected to the housing market’s performance over the coming months will be essential, as we continue to evaluate exactly how the housing market is doing in this uncharted time ahead.