Today's Headline - There's a housing bubble and it's about to burst!

Hi everybody,  It’s Joe Hillner with Your Home Sold Guaranteed Realty, where we guarantee the sale of your home, or I’LL buy it! 
Ok, so every week, I share market data to keep you informed with the local real estate market.  Here is this week’s Boca Market Watch.

First, Single Family Homes:

This past week, a  good week with 68 new homes on the market, ranging from $269,000 to  $26.5 Million - nice! Only 18 homes back on the market, while 16 homes listed took a price decrease, and 10 sellers raised their asking price.  63 different properties went under contract, and 43 went pending, a decent week. 
And only 23 homes were unsuccessful in selling and were taken off the market or the listing expired outright, very very few.   85 homes were sold in the past week, a very good week, and those home sales ranged from $304K to a cool $15Million.  

Next up, Condos and Townhomes:

86 new listings, very nice,and ranging from $50 Grand to $8 Million.  
23 units came back on the market, 30 properties with a price decrease, and 14 sellers with an increase, in total, not too many.  74 different properties went under contract, and 70 went pending. So condo sales continue to be very strong!!  And 45 condos or townhomes were unsuccessful in selling and were taken off the market or the listing expired.  108 closed sales this week, another very big week, and ranging in price from $60 Grand to a couple of sales at $3.25 M!

Here's what's making news right now.  There's a lot of talk about a housing bubble and that the market is about to collapse.  In fact, several buyers have told me just this last week that it's definitely coming and they're going to wait for it to happen, and then buy.  They mostly point to the new administration and say that the new economic policies, relaxed CDC 

 COVID guidelines and the multi-trillion dollar proposed budget will combine to tank the market. Well, maybe so... but then again, not so fast!  There are signs of potential trouble, but vaccinations are up, spending on new home construction is up, and overall, there are reasons to believe that the market will improve.
First, lets get the bad out of the way.  There are now just under 1.5 million realtors in this country, the highest # ever.  Why is that important? With the supply of homes so low and the supply of realtors so high, there's increased competition for a limited amount of work.  That puts downward pressure on earnings.  And right during the runup to the last market crash, the number of agents also surged.  That didn't cause the crash, but it was certainly one of the symptoms and is enough to give those of us who've been in the business a long time, a case of the jitters.
Next, as I've already reported, the cost of lumber has spiked 250% year over year and sheet rock is up over 300%, wow!  I've also told you that the labor to help build new homes has also dwindled.  In fact, on a national level, between late 2019 and the end of 2020, we lost a million workers in the housing industry.  They are coming back, but its a slow process and builders are struggling to come anywhere close to meeting the demand.
In February and March, referral platform HomeLight conducted a survey of more than 1,300 real estate agents. The survey gauged agents’ take on the market, and ultimately found that just 10 percent thought today’s extraordinary amounts of demand would be satisfied “soon.” In addition, 91 percent of survey respondents said inventory this spring was lower than they expected. A year ago, only 73 percent of agents said the same thing.

Other findings in the survey include that 69 percent of respondents said sellers are bailing on the market and not listing their homes; 24 percent “worried that homeownership is becoming more of an ‘exclusive club’ as some buyers get priced out”; and 94 percent said the inventory shortage in their market is getting worse.  So the overriding sentiment among those who work all day, every day in the industry is rather pessimistic.
Now, on the bright side - a third of out population has now been vaccinated. With the outbreak receding, for example, standard practices such as open houses and in-person showings could theoretically become ubiquitous again. Would-be sellers who were afraid of letting people inside their houses might finally opt to list their homes. I went on a listing appointment last week and when I got there, the homeowner wouldn't even let me in the door to see the place. How am I supposed to determine its value when I can't even assess its condition, or sell the place if no one can get in, lol?
Another bright spot - residential construction spending is up 23% year over year, despite the issues I've already mentioned.
And fix n flippers are selling their properties primarily to owner occupants, rather than renting them.  There's a huge population of institutional investors who snapped up millions of homes - 57% of them are being sold to owner occupants, which is great.
At the end of the day, real estate comes down to sales, and projections from NAR indicate that despite all the challenges, 2021 should hit a high point: 6.22 million existing home sales. That would be 10.3 percent higher than 2020, when about 5.6 million homes sold.
At the end of the day, homes are flying off the market and prices are rising, but transactions are flowing. The market is still alive. That doesn’t mean times will be easy in the near future, but it should offer some that the real estate market is not going to correct itself any time soon.