COVID-19 has changed people’s perspectives when it comes to homeownership.
In the past, people tended to buy homes where their offices were. The necessity to be close to work led to places like New York, San Francisco, and Los Angeles having exceptionally high housing costs.
Now that more people can work remotely, people are starting to venture outside of these well-defined population centers and buy homes in more affordable, family-friendly places.
That’s part of the reason, at least, why the Birmingham housing market is so hot right now!
Given that the market is doing well, it’s worth asking if now is the best time to sell?
Let’s dig into the numbers and see if you should consider selling now. And, if so, what’s the best method to sell your property quickly and receive a fair offer.
The Birmingham Housing Market Is Red Hot
First, let’s start by saying that the Birmingham market is doing fantastic. There’s a tremendous amount of optimistic data coming out of The University of Alabama.
At the time of this writing, the latest stats show that Birmingham real estate demand is up 28% compared with last year. Supply is down, in large part because people are snapping up homes so quickly. And, on top of it all, the median sales price is up 7% year-over-year.
Put another way, there were just under 1575 homes sold in December 2020.
This number is the highest quantity of homes sold in December since it started tracking this metric back in 2000! To find sales figures anywhere close to this, you’d have to go back to December 2006. Even then, the number of homes sold was 1450, well under the 1575 number we saw in 2020.
There’s no denying that the Birmingham housing market is hot right now. That’s a strong indication that it might be an excellent time to sell!
The Experts Predict 2021 Will Continue To See Impressive Growth
Most people expect the COVID-19 pandemic to subside in 2021. With more people getting vaccinated every day, we should start to see more confidence in the economy and more housing sales.
According to The University of Alabama’s forecast, there will be over 20,000 homes sold in 2021.
In 2020, there were 17,683 homes sold total for the entire year. This forecast tells us that most people expect the Birmingham housing market to remain in strong demand throughout the year.
While the researchers don’t provide a detailed explanation for their forecast, there are likely a few reasons why they expect demand to remain high. We already mentioned COVID declining.
However, there are two other reasons:
- Interest rates and what Birmingham has to offer.
Interest rates are relatively low by historical standards. While most experts expect them to rise slightly in 2021, when you look at the rates in the mid-1980s, rates now (3%) are about a sixth of what they were back then (18%).
Even looking back just five years, rates are lower now than they were then. Lower interest rates typically mean higher home prices as buyers can afford more home since they need to spend less on interest with each monthly payment.
The other reason is that Birmingham is an attractive place to live and raise a family
It has a vibrant economy (Indeed.com ranked it as the fourth-best city for job seekers in 2019), plenty of dining options, and an affordable housing market.
While home prices have increased substantially in the past few months, the median sales price is still $240,000. In many major markets, like New York, SF, or LA, $240,000 won’t even get you a condo. Here in Birmingham, you’ll get a lovely house for that money.
Birmingham also has excellent school options. There are three private colleges, three law schools, and the University of Alabama at Birmingham for college-aged adults. For younger children, there are plenty of 8/10 or higher schools from which parents can choose.
Ultimately, Birmingham is an in-demand area. With COVID letting more people work remotely, this trend will likely continue.
Birmingham Housing Market: Is Now the Time To Sell?
With the Birmingham housing market doing so well, should you sell now?
The answer to that is personal, for many reasons.
However, all the indicators point to you being able to sell your Birmingham home for more money than you could have in the past. If you look at the market indicators, property values never exceeded 240,000 until 2020 came. Before that, the median sales price grew steadily from $125,000 in 2000 to $224,815 at the end of 2019.
Home prices increased nearly 10% in one year.
While experts do expect home prices to continue to rise in 2021, it’s hard to believe that home prices can keep going up at this pace. Eventually, they will likely plateau.
Therefore, while you may be able to hold out and make a little bit more money selling later in 2021 or 2022, there are no guarantees you’ll wind up making more money. 2020 saw a pretty aggressive price surge, and selling might be the best way to capitalize on that!
How To Sell Your Birmingham Home
If you’re ready to sell your Birmingham home, consider selling to a cash buyer. Despite the Birmingham housing market doing quite well, it still takes an average of two months to sell your home using a conventional real estate agent.
Additionally, these agents take anywhere between 5% and 6% of the sales price. Assuming you have an average $240,000 home, that means you can expect to pay anywhere between $12,000 and $14,400 in commissions!
With a cash buyer, there are no commissions.
Cash buyers can also close within one or two weeks, enabling you to lock in these high home prices and get out of your home quickly. While most experts don’t expect the market to head south, there’s always that possibility
With a cash buyer, you’ll get an offer within days and be able to close just a few days after that.
If you’re interested in selling your property, please contact us at Cash Home Offer USA! We would love to learn more about your home and provide you with an all-cash offer as soon as possible!