Southeast Michigan Year-End 2020
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49,602
2020 Closed Sales
no change from last year
$261k
Average Sale Price
+10% from last year
$148
2020 Price Per Square Foot
+7% from last year
$12.9b
2020 Dollar Volume
+10% from last year
Summary
While new pendings have consistently outnumbered new listings, inventory levels have dropped every month since January. Inventory is 47% lower than a year ago. Despite Covid, a six-week market shutdown and the shortage of inventory, 2020 closed sales are only 12% behind last year’s pace and the gap is narrowing. Even with all the recent economic and lifestyle changes, buyer demand remains high and home values continue to rise—YTD average sale price is up 7% and price per square foot is up 5%. For anyone thinking of selling, it’s not too late to take advantage of one of 2020’s few gifts—a strong housing market.
2020 Finishes Strong
2021 Begins with Spring-Like Activity
Typically, market activity and prices fall off in the fourth quarter as demand drops and inventory becomes depleted. Despite record-low inventories (down 58% from a year ago), both sales and prices finished the year with extreme momentum. Year-over-year December sales were up 17% and higher levels of year-end new pendings carried over into higher January closed sales.
Heading into 2020, demand was high. It was pushed to an extreme as avoiding COVID had us spending most of the last year in our homes.
The role of the home has expanded to include home office, school room, and recreation center. The additional requirements pushed record numbers of buyers into the market at a time when inventory levels and interest rates were near historic lows.
Although demand is highest in the more affordable price ranges, lack of inventory has caused a decline in sales in the lower and middle price ranges. Sales in the upper price ranges have increased the most, but prices have been relatively flat in most upper-end markets.
Prices typically fall off in the 4th quarter as inventory levels become depleted and picked over (see the blue prior year bars in the $/SF chart to the left). Recent fourth quarter prices didn’t drop. Year-over-year prices were up 12% in both December and January. Expect that jump-start on prices to carry over into 2021. Both buyers and sellers who will be moving this year would do well to get an early start.
