Pandemic Fails to Slow Housing Sales

1/20/2021 2:38 PM

Pandemic Fails to Slow Housing Sales in Peoria Area During Challenging Year ... The family home took on a new importance in 2020. The year that challenged the Peoria area's health, business and employment in unprecedented ways saw home sales climb by 18.3 percent over 2019.

During the year 2020, home sales increased by 28 percent in the third quarter and by 29 percent in the fourth quarter compared to the same periods in 2019, according to Peoria Area Association of REALTORS®.

Some 6,778 homes were sold in 2020 compared to 5,729 in 2019. This is the highest amount ever recorded by the Peoria Area Association of REALTORS® going to back to 2005 when 6,167 were reported sold that year. The median sales price rose to $125,000 in 2020, up from $118,000 the previous year. The average sales price, according to PAAR statistics, was $147,490 up from $138,038 in 2019.

PAAR President Jason Catton cited a number of reasons for the housing surge in a year when REALTORS® had to take more precautions than ever in order to serve their clients.

"Obviously, low interest rates are a factor. Affordability plays a part, as well," he said, referring to the benefits buyers found who moved in the Peoria area from other parts of the state and country.

The pandemic has played a part in engaging new buyers, he said, "With more people working from home and more remote learning taking place, home owners are looking for more flex space in their homes," said Catton.

Look for historically low interest rates to continue this year, note national housing experts. The 30-year mortgage is expected to average 3.075 percent in 2021, down from 3.125 percent in 2020, according to a forecast from the National Association of REALTORS® and Mortgage Bankers Association.

The biggest challenge for the Peoria housing market right now is just finding enough homes to sell, said Catton. "We need inventory. Only a 2.3 month supply of homes was available in this market at year's end compared to 4.7 month supply at the end of 2019," he said.

"Since we've been keeping track, we've never seen a year when the months of supply for homes has been so low," said Catton.

Such inventory levels make it a great time for sellers if a house is priced correctly, he said. "I personally have seen one client who has submitted offers on two different properties. In both cases the client offer was not accepted due to over full price offers from other buyers that had also submitted offers for more than the list price to acquire the property," said Catton.

Other factors affecting the area's low inventory numbers include the fact that little new construction has occurred in the region during a period when COVID-19 has slowed progress, he said.