Lancaster County Real Estate Market Statistics for October 2020

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Daylight Savings Time ended on November 1st this year which means the days are getting shorter.  However, the hours that a typical real estate agent invests in their business continues to grow.  Despite the uncertainty of the COVID-19 pandemic, the presidential election, and the economic recovery, the Lancaster County real estate market continues to be HOT!

What’s causing these unprecedented market conditions?  Let’s take a closer look at October’s numbers to look for some clues.

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Average Sales Price – This is the second month in a row of double digit increases year of year.  While these appreciation rates are great for sellers, they do cause a little indigestion because we don’t want the market to overheat and meltdown.  No worries.  Although the current month’s average sales price is 12% more compared to last year, many of the other factors that are in play point toward a healthy real estate market which we’ll get into in a second.

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Listing Inventory/Units Sold/Median Days on Market – Although the listing inventory ticked up a little bit (which is a good thing), we’re still experiencing a shortage of homes at virtually all price points.  Homes that are realistically priced are selling in about a week.  This can be attributed to the pent-up demand of buyers who had to sit on their hands during the COVID-19 pandemic shut-down of the real estate industry.  As soon as the State allowed buyers and sellers to conduct in-person business again, the flood gates opened up and they haven’t closed yet.

Average Interest Rate – The news on this front just keeps getting better and better.  Historically low interest rates at under 2.9% are contributing to the strong market that we are experiencing.  These unprecedented low rates continue to entice buyers to put up with losing many multiple, competing-offer situations just so they can take advantage of the rates.  Agents should not assume that buyers know what this low rate means to their bottom line so do the numbers for them.  Compared to last year, obtaining a $250,000 mortgage is $118 less expensive per month – – – and over $42,000 less over the life of the loan.

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Absorption Rates – These are the rates at which available homes are sold in a specific real estate market and price range during a given time period.  It is calculated by dividing the total number of available homes by the average number of sales per month.  The rate represents the number of months it would take to clear out available inventory if no other homes came on the market.  The rates today are all pointing to a hyper-strong seller’s market.  With inventory levels so low, it’s a great time for a seller to put their home on the market.

Until next month – – – all the best!

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