The Coming Home Tsunami

The real estate market has become like shopping for toilet paper & Purell when Covid-19 lockdowns first began in March, 2020. Buyers are scrambling to view & bid on homes that would be considered trash before Covid. Not only are the homes getting bought within a week, but if you live in a hot real estate market like the SF Bay Area, you can be outbid by $100,000 to $400,000 with no contingencies! Remote locations in nature settings like Lake Tahoe are also experiencing a surge in buyers, and some homes are getting $100,000 over asking price with no contingencies. The 2 main reasons for the bidding wars are record low home inventory and record low interest rates. Due to Covid, many people don’t feel safe opening their homes for showing, even with practiced safety protocols; thus, the home supply is suppressed. Covid has wrecked havoc on the economy, so the government has kept interest rates low, which enables banks to offer mortgages at low rates; thus, buyers have more purchasing power with bigger loans.

Have you toured homes & made offers, only to be outbid, or have you read crazy stories about home bidding wars & poor home supply? Well, don’t despair because there should be a home tsunami coming this summer. Why is it a tsunami? Because like an ocean tsunami, you won’t realize it happened until it’s upon you. The number of buyers will probably be the same, but the number of homes available should double or triple by summer. Let’s go over the causes that will make the home supply swell: