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Your SML Market Advisor 2020 Real Estate Market Recap THE 2020 MARKET WAS ON FIRE You’ve probably heard. The 2020 Real Estate market was a buzz with stories of new listings selling in a matter of hours, multiple competitive offers for sellers to choose from selling well over list price and buyers flocking from all parts of the Country to get their piece of SML to call their own. What events sparked this dramatic chain of events in shifting market conditions? What effect did the COVID-19 pandemic have on our local market? I’ve got the scoop for you. THE 2019 MARKET In the last fourteen years, the waterfront market here at Smith Mountain Lake would most appropriately be described as a “Buyers Market”; offering more supply than demand, which gave buyers the edge when choosing property and negotiating deals. We ended the 2019 year with 285 closed sales, a 13% increase over 2018. Sellers could expect to wait an average of 227 days on market before an offer would be received, with an average list to sales price ratio of 95%. In short, it was a tough spot as a seller. With so many competing homes for buyers to choose from, sellers often had to be quite strategic in their pricing, marketing and negotiations. Some sellers resorted to staging, merchandising and above and beyond the “norm” in repairs out of necessity to make the sale happen. COVID-19 CHANGED EVERYTHING As the Covid-19 pandemic became increasingly part of our day to day news and language, I was bracing for perhaps one of the most challenging years in sales. The uncertainty of the pandemic and its effects on the economy produced some anxiety for all. Unemployment rates were at an all time high since the Great Depression. In April alone, 20 million Americans had lost their jobs. In addition, standard practices of the real estate profession as a whole like meeting with and consulting with buyers and sellers, scheduling photography, signing agreements and conducting inspections and appraisals had to be re-engineered to do in a safe and effective way, while maintaining professionalism and the quality of representation I would typically in person be able to offer. I had to carefully and critically plot out each and every aspect of my schedule for the day- do I have enough sterile masks, gloves, and shoe coverings for each appointment? The ongoing thought process was: How can I protect my homeowners to the greatest degree possible, (many who were considered high risk because of age or health concerns) that wanted, or needed to sell during this time? (If you’re curious about COVID-19 safety protocol involves when selling or buying, email me for a list of my standard practices) As the virus was spreading, so was the best kept secret of Virginia’s Jewel of the Blue Ridge. What effect did the COVID-19 pandemic have on our market? COVID-19 EFFECT ON OUR LOCAL MARKET In short, the market took a swift shift in the most positive direction for sellers, taking all of us by surprise. Here were the reasons for the shift. 1. Historically low interest rates The temptation to buy that second home or retirement place that many buyers were once considering to be a few years down the road became too tempting to resist with the interest rates that now became available. Buyers started to pull the trigger quickly at the start of the early Spring market. Tom Lusk, senior mortgage officer with Atlantic Bay Mortgage, just celebrating his 23rd year of service shared with me that “2020 was my best year in the business. My loan volume was up 56% over 2019. It was just an incredible year”. 2. We learned we can do a lot from home. This pandemic has brought about interesting revelations to many executives, small business owners and employees alike. We learned how efficiently we can run our business’ from home base. With that newly found discovery, many buyers decided they weren’t going to wait anymore. It was the time to work where they wanted to live. This was a second catalyst that sparked the heat of the market. 3. Is there a better place to quarantine and social distance than at SML? For those that were already owners here at SML; many felt an enhanced appreciation of the treasure they possess, social distancing while enjoying their sunset cruise, basking in the beauty of our area. Long time resident of Smith Mountain Lake, Jerry Hale, the proud owner of the majestic castle that I had the privilege of selling this year describes SML as “charming and magical, and for those fortunate enough to live at the lake, they enjoy an abundance of pleasures”. Well said, Jerry. 4. Nationwide, waterfront property became the “go to” for surviving quarantine. While the North Carolina Triad, Northern Virginia and Richmond are our most typical buyer feeder markets, I experienced buyers coming from all over the nation. I sold one home to a couple from Washington, who bought the home sight unseen; all via Zoom! I was honored with the level of trust bestowed upon me as I described the color of the exterior I was seeing. I wouldn’t be honest if I didn’t say that selling homes via video and buyer sight unseen doesn’t create some anxiety in me. I can’t say that I personally would be able to make such a large investment without all my senses at work in the decision. Yet, video selling became the only way to secure property for many buyers that were not local. Simply put, if you wanted a chance at a great property, you better be able to move and move quickly. That first sale over zoom led to multiple others this year, another fascinating change this pandemic has resulted in! These factors lead our market to a pretty incredible and historic year. Here’s our 2020 market totals: WATERFRONT SINGLE FAMILY HOMES: Total Sales: 427 Average Sales Price: $721,183 Average Days on Market: 149 Average List to Sales Price: 97% Average Sold price per Square foot: $228.72 If you love following the market, email me and I’ll connect you with my annual report that contains much more detail. THE CURRENT MARKET AFFECTS YOU How has the current market affected you as a real estate owner? If you are a waterfront homeowner, the chances are high that your market value has increased within the last six months. Whether you want to sell, would like an annual analysis of your investments or are just curious, reach out and I’ll be glad to provide a free, no obligation report. One of the most exciting stories in increased market value that highlights the dramatic increase in market value is with a home I sold, representing the buyer this Fall. Just two months later, circumstances changed and I was asked to now list the property. It was under contract in less than 48 hours with multiple offers. In just a two month time period, the market value increased over $100k, a 10% increase in sales price. While there has been a slight slow up on the number of buyers lying in wait for the next great property to hit the market, in general there are still plenty more out there. In December I wrote three offers for three different buyers. One was competing with nine other offers, one with four, and one with seven. When representing sellers on the list side, no amount of verbal communication can quite prepare the homeowner for the flooding requests for showings on the hour every hour or having to vacant their residence for the first couple days to allow buyers and agents alike access. In some cases there are so many offers that I’ve used a spreadsheet to simplify all the terms and conditions for the seller to consider. If you’re considering selling and wondering if now is the time to cash in, give me a call. WHEN WILL THE BUBBLE BURST? How long will these trends last, you ask? Well, I dare say if any one of us had the ability to say with certainty, we’d all make decisions that would reflect the best timing to capitalize on this market. However, working from what we do know based on data, trends and statistics nationwide, economists estimate that these conditions in waterfront areas may last another year to three years, labeling it the “Covid-19 hangover”. WHAT YOU SHOULD DO In conclusion, no one could have predicted that 2020 would have turned out to be such a momentous and exciting time in our local market. For an annual statistical analysis of the market with comparisons of this year’s sales versus previous years; email, text or call me for your personal copy. As your SML Market advisor, I’m happy to provide a free broker’s price opinion of your property. Simply reach out! REAL ESTATE PLANNING STARTING 2021 WITH CLEAR REAL ESTATE GOALS REGISTER AT: EVENTWITHJADA.COM Selling Smith Mountain Lake caring. conﬁdent. connected. FOR MORE MARKET INFORMATION: JadaTurnerRealtor.com firstname.lastname@example.org 540-263-0202 © ©2020 BHH Afﬁliates, LLC. An independently owned and operated franchisee of BHH Afﬁliates, LLC. Berkshire Hathaway HomeServices and th he Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc.® Equal Housing Opportunity.