The Columbus housing market is heavily favoring sellers in mid-2021, a trend that may not wear off before the end of the year.
Chris Jiles, Re / Max Champions Realty realtor in Columbus and past president of the Georgia Association of REALTORS, says homes are moving fast and buyers are paying more in the Columbus area. Most listings sell in about 40 days, he said. It takes around 30 days to complete the closing of a home – a given property will go on sale for around 10 to 14 days.
“In the past six months we’ve moved into a market with strong sellers,” Jiles told the Ledger Enquirer. “We see several offers for houses that are only on the market for a few days. The prices have risen. People pay the asking price. “
That means the housing market in Columbus is strong despite COVID. And the bubble mustn’t burst so quickly.
The average sales price in Columbus as of July was $ 214,626, up 11.7% year over year, according to the Columbus Board of Realtors. In nearby Phenix City, the average sales price in July rose 9.9% year over year to $ 208,273, according to the Alabama Board of Realtors.
Columbus sellers have traditionally contributed to the cost of closing a home, as buyers and sellers usually split the cost.
“We don’t see any of it now,” said Jiles.
Buyers in today’s market will cover all of their closing costs, Jiles said, without the sellers being involved.
The number of days on which a house is listed has shot down. In May 2020, the average number of days on the market was around 68 days. In May 2021, that number dropped to 44 days, Jiles said. Interest rates are also at historic lows, well below 5%.
Georgia Governor Brian Kemp thought real estate was an essential industry, Jiles said, so agents worked through the pandemic.
“I would have thought that COVID would have slowed our market just because people didn’t want people to come into their home and potentially bring the disease in,” he said.
Northern buyers moving to states like Georgia and Florida are one of the reasons home prices have skyrocketed, according to Dedrick Josey, Coldwell Banker’s real estate agent.
Others are “cash rich” buyers who have recently sold their home and are using the funds for the full purchase price of a home, he said.
“Sellers tend to engage or entertain cash buyers rather than buyers in need of an eventuality that is usually a loan,” Josey told the Ledger Enquirer.
Will the bubble burst?
If the bubble bursts, don’t expect it to happen this year.
The strong seller market is expected to persist “for the rest of the year,” Jiles said. Part of this is being driven by the low interest rates.
“A 3% interest rate is not uncommon (in today’s market),” he said. “The lowest interest rate I’ve ever had was 6 5/8%, and I was proud of that. I’ve already seen houses with an interest rate of 12%. “
Josey said he encourages contingency buyers to save as much money as possible in order for their listings to be competitive. He also urges them to look for other loan products, such as traditional bank loans.
“It makes it difficult for (the agent) and your client to conduct a home hunt if you don’t have what sellers are looking for financially,” said Josey. “And that’s cash.”
Millennials, young people, and those drawn to the city by Fort Benning and other major employers play a role in the city’s housing market. Millennials make up the largest proportion of homebuyers in the nation, according to the National Association of Realtors.
Almost a third of millennials said COVID-19 urged her to start looking for an apartment earlier than planned, a survey by the data company Clever Real Estate found among 1,000 people who are planning to buy their own home in the next year.
Columbus’s economy is also expected to see further recovery of the pandemic, according to the UGA’s Selig Center for Economic Growth.
“You will know better where you will live when you put your home on the market,” Jiles told prospective sellers, “because you will be moving in 30 days.”
Ledger Enquirer reporter Joshua Mixon covers the business and local development. He is a graduate of the University of Georgia and the owner of the coolest dog, Finn. You can follow him on Twitter @JoshDMixon.