Editor’s note: This article was first published in September 2020 and reflects market conditions at that time.
Despite the pandemic, demand for homes was rising in 2020. In June of that year, the Mortgage Bankers Association reported a 26% increase in mortgage applications for new homes compared with the previous month.
Buyers wanted single-family homes
Buyers weren’t looking for just any property. They wanted single-family homes in particular. As we covered in an earlier post, the typical house hunter in 2020 was a millennial woman.
Why so little interest in multi-family buildings, condos and townhouses? With so much uncertainty, most people didn’t want the extra worry of finding and keeping tenants. Many were also first-time buyers, who want a home to live in and aren’t thinking about rental income.
How sellers could take advantage
After months of quarantine, house hunters wanted space. Sellers with roomy homes had an edge, but only if the listing made it obvious.
If you were selling a single-family home, the advice was to make sure your agent highlighted the space: in the online listing, in the photos and during in-person or virtual tours. A selling point is easy to undersell when nobody draws attention to it.
How builders could take advantage
Builders had an opening as well. Knowing that buyers wanted room to roam, they could deliver it in one of two ways:
- Build on a large plot of land
- Build a larger home on a smaller plot
Either way, timing mattered. Builders who moved quickly met the demand while it was strongest.
Financing a build
For builders who need capital, Sachem Lending offers new construction loans. Our post on when to consider a construction loan explains how they work, and you can apply online when you’re ready.
