Home buyers have rushed to take advantage of some big discounts on condominiums, and the condo market overall is now recovering strongly since the COVID-19 pandemic began.
A report from the real estate brokerage Redfin shows that many home buyers have been looking to upsize since the start of pandemic-related lockdowns, heading to the suburbs or more remote towns where they can buy larger single-family homes. But some are being priced out as single-family home values rise, and instead they’re looking at more affordable condos.
The average single-family home in the U.S. now costs $58,000 more than the average condo, hence the growing demand.
Of course condo sales haven’t accelerated as much as home sales. Condos tend to stay on the market for longer, averaging 36 days in October compared to just 27 days for single-family homes. And just 23% of condos sold for more than their list price, versus 37% of single-family homes.
But after condo sales fell more than 50% in the spring, they have recovered strongly. In October, condo sales jumped 22.7% compared to the same quarter one year ago, on a seasonally adjusted basis, Redfin said.
“Condo sales are rebounding because buyers are finding great deals,” Daryl Fairweather, Redfin’s chief economist, said in a statement. “Families are fleeing cities in search of more space in the suburbs, which has presented an opportunity for millennials who are looking to become homeowners but don’t need extra bedrooms or a backyard.”
Experts agree that condos are much more affordable, and people who couldn’t afford one a few years ago are now jumping at the chance to buy one.
“Before the pandemic, it was challenging to find a condo in Seattle for less than $500,000, but now there are plenty selling for under $400,000,” said Forrest Moody, a real estate professional with Redfin. “The people who are buying condos now are the people who couldn’t afford to buy one a couple of years ago because prices were so high. I recently sold a condo that was within walking distance of Amazon’s headquarters for $510,000. Condos in that building normally go for $550,000 and up.”