It is no secret the coronavirus (COVID-19) global pandemic is affecting the real estate market nationwide. The number of deals entering escrow has decreased, as well as the number of listings. Not many people are interested in moving right now, and this lower demand is met with a lower supply. The result? "Prices are holding relatively steady."
An economist at Zillow, Jeff Tucker, explained it as such:
"Like a canoe being carried by two people who drop both ends simultaneously, the market slowdown may not tip clearly in favor of buyers or sellers."
This accurately represents the current situation, however as the pandemic evolves and progresses, so will the market's response.
The week of April 19, the number of listings in Southern California was 31% less than this period in the previous year. In Los Angeles County and Orange County, there were 60% fewer home buyers signing sales contracts than in April 2019. Decreased sales and listings have been seen throughout the coronavirus era.
There has been a significant drop-off of listings, indicating that not only are people refraining from putting their homes on the market, but some are even taking their listings off the market altogether. Why? Some homeowners don't want to have their real estate agents and strangers in their homes during a pandemic. Additionally, some want to wait to see how the market progresses and since they are in no rush to leave their home, they are waiting it out.
Hong Kong experienced a similar phenomenon in 2003 during the severe acute respiratory syndrome (SARS) outbreak that we are experiencing now. Prices didn't fall much, but the number of transactions plummeted.
However, things just may be looking up!
The number of active listings and the number of pendings in the US are of course less than last year, however, they both seem to be increasing within the past few weeks.
April Weekly New Pendings:
April 6: 21
April 13: 17
April 20: 29
April 27: 40
To see the numbers per week from January 2019 until April 2020, click here.
