These are great questions, and ones I've been perplexed by since the beginning of COVID (and lets not forget the financial crises that hit weeks before that). I sell RE in W Bellevue and we also had a MONSTER August. Usually August is one of the slowest months of the year as families get in the last vacation tim of the summer before school starts.RoadDawg55 said:
I haven’t gotten to the point of investing in real estate. I do watch a couple reality shows on real estate and saw that one of the guys on a show recently said August was the best month he ever had. If true (have no reason to believe it wouldn’t be) what are the reasons? What is causing people to buy right now?
From a seasonal perspective, the normal spring home buying season was delayed 2 mos due to CV. But that alone doesn't really address your question.
From a national perspective the RE market should be getting hammered. And in my opinion still will. With 25M people permanently out of work and the end of stimulus/unemployment insurance at the end of July, people flat aren't making their rent and/or subsequently their mortgage payments. I've heard from multiple sources foreclosures are stacking up at the banks, however they can't do anything with them yet as there is still a moratorium on foreclosures. Eventually these properties will flood the market.
I'm not sure these antidotes answer your questions either, but they should be pointed out nonetheless.
-The downtown Seattle condo market is crashing. Apartments in Seattle are lucky to have 85% occupancy rates and good luck with that amount of revenue coming in. People are door.ass.out to closed-quarter living.
The Eastside is a Tale of Two Cities. If properties are are priced well, they are FLYING off the page still. There is a huge push for people to buy New Construction OR Waterfront (lulz that there is any waterfront available). It's a couple times per week that I'm amazed by a sale in our market.
For example these two New Construction homes went Pending this past week at record prices for their location and without any view:
The only conclusion I can draw is we? are the beneficiaries of the upper-leg of a "K-shaped" recovery. The push on the Eastside is based on FANG stocks being UP in a post-covid environment. Amazon is up 60-80%? It seems every other week Amazon purchases or leases another 1M sqft of office space. Facebook just bought the REI corporate building in the Spring District. Microsoft is going through the largest expansion of it's campus in decades. Google bought Kirkland Urban for $435M, then promptly bought the dirt next door for another $40M. In short they are ALL still hiring in BIG ways.
Add to that the these FANG execs and employees are fleeing CA and Seattle-proper in droves to get away from the politics and failures of it's governance. I'm not trying to make a political statement here (in spite of my Tug poasting history), it's just something I see and hear from clients/buyers on a daily basis.
Another factor in the post COVID environment is people who can work from home, are chosing to GTFO of the greater Seattle area all together - to the San Juans, Idaho/Sun Valley, Colorado/Vail/Aspen, Montana etc etc etc.
One thing that completely boggles my mind in light of the 25M who are never getting their jobs back, is how many people CAN - and ARE - writing checks for 8-figure residential homes. Every single day it amazes the sheer volume of people who seemingly come out of the woodwork to do it.
Lastly, and from a Macro investment perspective, (I will need to find the graph that supports this) but in the last half-dozen recessions this country has gone through Real Estate stays up or even when the stock market/economy are getting slaughtered. (The notable exception being '08 when it was a real estate bubble that popped.) Thus, you can make the case people with swelling stock portfolios are trying to move their holdings to RE in anticipation of a large impending/inevitable crash.
*I'm sure I'll have more thoughts to add as I ruminate on this poast.