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Realtor.com just released its latest numbers on COVID-19’s impact on the national residential real estate market. The data tracked is for the month of March, which not surprisingly changed significantly over 31 days.
“The month started out to be a strong spring buying season, which is what we expected,” explains Danielle Hale, chief economist at Realtor.com. “The impact of COVID-19 materialized in the latter half of March. Week by week, we are seeing decreases in new listings.”
It’s no surprise sellers who don’t have to sell right now are rethinking listing their homes. Buyers who aren’t under pressure to purchase a home are also pulling back. Inventory declines, a key market indicator, are also slowing. “We are seeing buyers hesitating as much as sellers now. In February, we had lots of buyers out there actively looking and not enough inventory,” Hale recalls.
Here’s what some of the number crunching Realtor.com did for March looks like. The number of homes for sale declined 15.7% year-over-year. Despite the decline, the national median listing price grew 3.8%, to $320,000. When Realtor.com looked at the weekly data, including the last two weeks of March as the coronavirus crisis hit more parts of the county, listing prices were growing at the slowest paces for 2020. “The data is constantly evolving as we look at weekly numbers,” Hale notes.
The most up-to-date research clearly shows declines in homebuyer interest. According to Realtor.com, in the weeks ending March 21 and March 28, newly listed properties decreased by 13.1% and 34.0%, compared with the year before. This supports recent surveys conducted by Realtor.com pointing to declining interest for potential buyers and sellers.
Let’s look at specific markets around the country. The metros that saw the largest declines in inventory were Phoenix-Mesa-Scottsdale, Ariz. (-42.2%); Milwaukee-Waukesha-West Allis, Wis. (-36.2%); and San Diego-Carlsbad, Calif. (-33.4%). The only area showing positive inventory increases was Minneapolis-St. Paul-Bloomington, Minn.-Wis., at 3.6%.
The metros with the steepest price declines were Dallas-Fort Worth-Arlington, Texas (-2.7%); Minneapolis-St. Paul-Bloomington, Minn.-Wis. (-1.4%); and Houston-The Woodlands-Sugarland, Texas (-1.4%).
Hale says the dynamics of the market for buyers are positive: “For people that have to buy right now, they are more likely to get a good deal since there are fewer people out there.” Conversely, sellers who must sell know this and must respond to these current market dynamics.