Real Estate Activity Dramatically Increased After Safer-at-Home Orders Were Lifted
Whether you live in Lake Geneva, Harvard, Illinois, or anywhere in between, things have shifted over the past few months in almost all areas of life. One area that has seen significant changes has been the real estate market.
United States-based real estate in general saw a major slowdown of closings in Q2 due to COVID-19, but activity picked up significantly towards the end of May and continues today. The traditional summer buying and selling season shifted and has been happening later than it would in a typical year.
“We really did not know what to expect to see in terms of values in Q2 of this year, but we were confident they would hold considering the underlying strength of real estate in this region,” says Tom Keefe, President and owner of Keefe Real Estate.
Safety was, and continues to be, a top priority for the Keefe agents while still providing knowledgeable and timely sales services for both buyers and sellers who were still in process
when the pandemic hit. Adaptability was crucial, Keefe immediately began providing virtual options to accommodate buyer’s and seller’s comfort levels, including virtual meetings and open houses. As states began to lift safer at home orders, activity picked up at a rapid pace with no signs of a slowdown.
Southeastern Wisconsin Remains in High Demand
Despite the global pandemic and safer-at-home order in Wisconsin earlier this year, the most remarkable trend for Southeastern Wisconsin is that median pricing is continuing to rise.
While sales and volume figures were down compared to last year, but with increased activity after the close of Q2, these numbers are expected to spike when Q3 wraps up. Current inventory levels of homes at all price points are low, creating a higher level of buyer demand across the region.
“To see values hold steady, or even tick up, speaks volumes about the ongoing resilience of Southeastern Wisconsin and Walworth County,” says Keefe.
Overall, the Southeastern Wisconsin counties of Walworth, Racine and Kenosha, all saw the median price increasing for single family homes.
“With the safer-at-home order, activity slowed dramatically in March and April, but bounced back to stronger than normal levels once restrictions were eased. Based on the number of showings and future booked business, we expect a large portion of lost business to be picked up in Q3, giving even stronger signals regarding the health of real estate,” adds Keefe.
Lakefront Amenities Enticing Buyers
Although the number of sales of lakefront properties declined during Q2, a single quarter is always too short of a time period to understand what is happening on the lakes. That’s even more true with the increased activity over the past couple of months since the second quarter ended.
“A second home or luxury lakefront buyer typically spends anywhere from 6 months to 3 years before making a purchase. Once the stay-at-home order lifted in Illinois, our agents reported buyers making decisions significantly faster than normal, citing their desire for an escape or relocation out of the Chicagoland area,” says Keefe.
Trends for lakefront homes and homes in general have shifted due to the pandemic. Home offices, as well as expanded outdoor areas are ranking higher for current home buyers. Access to lakefronts, or homes with a pool, are being snatched up quickly because they allow the owners to enjoy these amenities without having to travel outside of the home.
The early signs of shifting buying patterns are benefiting our local real estate market. “At this point, lack of inventory, even on the ultra-high end, is our biggest challenge,” Keefe notes.
While showings and new listings dropped considerably in March, April and early May, the market picked up dramatically once the safer-at-home orders were lifted. As a result, closings in Q2 were down roughly 20% compared to 2019, but because of the pick at the end of April, Keefe expects to see that business shift into Q3, rather than disappear. “Our showings have remained at peak levels since the end of May, and we are forecasting an extremely strong third quarter. It is as if our spring selling season started in June.”
While the third quarter has not ended yet, a look at lakefront home sales alone rose 53% in July and August, compared to the same time last year.
Keefe mentions that this shift has been happening all summer long. “The typical lakefront buyer was older and also had a home in warmer climates for the winter months. Now, we are seeing families with children still in school and looking to make this home their permanent residence instead of a vacation home, as they realize they can still work from home here, or anywhere.”
Despite, or perhaps as a result of the global disruption, Southeastern Wisconsin’s communities and lakefronts continue to remain in high demand.
Is Demand in McHenry County Shifting?
Like the Q2 statistics in Southeastern Wisconsin, the data shows that while sales are down, values are holding steady or increasing. This is particularly interesting in McHenry County because previously this location saw a downward trend.
“To see the values hold steady or slightly increase in McHenry County and the City of Woodstock, was a good indication of how strong this area is as well,” states Keefe. “Northern Illinois experienced the same activity slowdown but bounced back quickly. With the recent activity, we’ve already seen increases which are providing even stronger signals regarding the health of real estate.”
For the time being, Southeastern Wisconsin and Northern Illinois continue to be a robust real estate market and buyer demand far outweighs current inventory levels.
Click here to view or download the full, in-depth look at the Q2 2020 Keefe Market Report.
If you would like to connect with one of Keefe’s real estate experts, please reach out to Natali Grgas at 262.475.0882 or email@example.com.