Northern Michigan is starting to open back up after Gov. Gretchen Whitmer’s shut-down orders over the past two months to halt the spread of the deadly COVID-19 pandemic. Realtors were allowed to go back to work on May 7, with guidelines for showings and social distancing. But how has the real estate market fared during the first three months of 2020?
Our longtime advertising partner Ted Schweitzer, an OMP resident and realtor with Real Estate One in Traverse City, takes a look at how the numbers shake out for the Old Mission Peninsula, as compared to the same time frame in 2019.
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“Prior to the COVID-19 crisis, the real estate market in our five-county area was experiencing a strong seller’s market with low inventory, low interest rates and very brisk demand,” he says.
“The residential real estate market on Old Mission Peninsula has been following that same market trend, but Old Mission Peninsula unit sales and volume at the end of the first quarter of 2020 reflect a decrease in activity due to the lack of inventory.”
Ted also notes that the demand for land on the Old Mission Peninsula showed a significant increase over last year, which “goes hand in hand with the amount of new construction we’ve been seeing on the Old Mission Peninsula.”
Residential sales, average sales prices and total volume have decreased since this same time frame last year. However, the average days on the market is 119, which is a decrease of 17% from last year. Let’s take a look at how the numbers shake out…
- Residential Sales, 2020 First Quarter: 13 (decrease of 13% from 2019)
- Average Sales Price, 2020 First Quarter: $429,500 (decrease of 17% from 2019)
- Total Volume, 2020 First Quarter: $5,583,500 (decrease of 28% from 2019)
- Average Days on Market: 119 (decrease of 17% from 2019)
Sales of land parcels, however, have gone up since this same time frame last year, although the average sales price has decreased. Also the average days on the market is 227, which is an increase of 27% from last year:
- Land Sales, 2020 First Quarter: 14 (increase of 250% from 2019)
- Land, Average Sales Price, 2020 First Quarter: $208,910 (decrease of 42% from 2019)
- Land, Total Volume, 2020 First Quarter: $2,924,750 (increase of 103% from 2019)
- Average Days on Market: 227 (increase of 27% from 2019)
What will the real estate market look like in the days, weeks and months ahead? Ted notes that economists who analyze national real estate are expecting a 15 percent decrease in sales volume due to the market being on hold over our nation’s stay at home orders.
“The local market barometers are strong and we are optimistic but proceeding with caution to see how our local economy opens up,” he notes. “There has been strong initial demand from out-of-area buyers fleeing high density neighborhoods attracted to our low infection rates and rural low-density area.”
One thing is for sure. People will continue to buy and sell property and homes for a variety of reasons, no matter what else is going on in the world.