As the world nervously watches the spread of COVID-19 (Coronavirus), the pandemic has begun prompting responses from every industry, and nearly every level of organization in the country. Perhaps a much anticipated social gathering or recreational league you or a family member enjoy has just been canceled or postponed indefinitely. Professional sporting events, concerts, and even political campaigning have been impacted. How then, has COVID-19 affected the real estate market, especially as we enter what was primed to be an especially hot spring?
Lawrence Yu, chief economist for the National Association of Realtors, had anticipated about 5.5 million sales of previously owned homes this year (an increase from 2019 and 2018).
That's because borrowing costs have plunged to lows never before seen (e.g., an average interest rate of 3.29% on a 30-year fixed-rate mortgage) and the job market is strong. Obviously, though, no one could have foreseen a virus disrupting market conditions at the start of 2020.
But just how disruptive is it? In the hardest-hit counties in the nation, such as King County, Washington, Realtors are reporting that homes are still being bought and sold like normal. Though there has been the occasional seller canceling an open house or removing a listing entirely, the fact remains that properties are still moving; buyers and sellers understand this market has something to offer for everyone.
Yes, experts are tampering their expectations for the spring market slightly. The most significant impact is the fact that sellers may be less likely to list their homes right now, which could dampen hopes that significantly more inventory would hit the market come spring and alleviate the supply stress. Conditions that make for a fantastic market for both buyers and sellers still exist—crazy low rates and rising home values.
Ultimately, you have to determine what’s right for you as a homebuyer or home seller. My job isn’t to push you into a decision you’re not comfortable with, but rather to provide hyperlocal context that may be lost in the national media coverage. Our market is still thriving.
Of course, the degree and nature of the COVID-19 outbreak may change, and that's why I will continue to provide you with the most up-to-date information possible. The simple fact is that I’m a Realtor, not an epidemiologist.
It's important that we listen to the medical professionals who are bearing the brunt of this, working hard to treat the infected, and developing a vaccine. We must all do our part to slow the progression.
So what can you do if you have your good hygiene habits down but still aren’t sure if it’s right to begin the home selling or home buying process?
If you're practicing social distancing, I'd be happy to offer you a virtual consultation. There's no need to meet in person. We can discuss your specific needs in detail, and I can also provide you with a virtual tour of homes you may be interested in.
Sellers: Setting up a mandatory hand washing station at open houses may be a great call. It communicates to the buyers that you're on their page--doing your civic duty to take COVID-19 seriously, but also determined to take advantage of great spring conditions.
If you have any real estate-related questions or you want more specific stats on how our market is performing, please reach out to me anytime. For COVID-19-related questions, routinely check the Centers for Disease Control website or contact medical professionals.
Cam and Sean’s Real Estate Team