Regional Spotlights: How the Real Estate Industry Is Faring Amidst COVID-19
The coronavirus pandemic has impacted markets worldwide. However, it can be hard to determine just how much this crisis has influenced U.S. real estate without looking at the impact on a local level. Here are the first quarter and April market reports for several states and key metro areas across the U.S.
New York City
In New York City, residential sales volume decreased 16 percent YoY, from $10.5 billion to $8.7 billion. Sales volume for condos and cooperatives in Manhattan also decreased, 35 percent YoY. The average sales price for a home in NYC in the first quarter of 2020 was $1.01 million.
“Market indicators have warned New Yorkers that the housing market was entering a downturn even before the coronavirus pandemic caused an unprecedented public health and economic crisis in New York City,” said Real Estate Board of New York President James Whelan. “As we expect to see residential sales again decrease next quarter, now more than ever, we must collaborate on effective and sensible policies at the city, state and federal levels to jumpstart New York City’s economy.”
Source: Real Estate Board of New York
Houston saw a 1.4 percent increase in overall April sales YoY. Single-family home sales, however, decreased by 19.1 percent to 6,199 in April when compared to last April’s 7,666. The median price for single-family homes increased by 2.4 percent to $251,000. Property sales for all home types decreased by 21.6 percent to $251,000. And in terms of dollar volume, YoY numbers for April were down by 20.4 percent to just over $2.1 billion.
“We were bracing for a rough report and we got it, and the numbers are likely to remain this way until more REALTORS® and consumers adapt to the use of virtual technology through HAR.com to safely market, tour and purchase or rent homes,” said HAR Chairman John Nugent with RE/MAX Space Center. “There is definitely no lack of consumer interest in real estate, as property listing views on HAR.com are up almost 60 percent from this time last year.”
Source: Houston Association of REALTORS®
Florida closings for single-family homes were up 10.2 percent YoY in the first quarter of 2020. Median sale prices were up for existing single-family homes, increasing 6.7 percent to $270,000. The condo-townhouse market? Closed sales totaled 27,379 in the first quarter, up 9.3 percent YoY. Inventory was at a 3.4 months supply for single-family homes in Q1, and at a 5.5 months supply for condo and townhouses.
“Compared to the same quarter last year, total residential sales were up in the first quarter of 2020 across all 22 Florida metro areas,” said Florida REALTORS® Chief Economist Dr. Brad O’Connor. “Remember, going into the first quarter last year, the stock market was somewhat in flux and we had just entered the longest-ever shutdown of the federal government. So, home sale activity was a bit slow to start off. By March, though, falling mortgage rates came to the rescue and sales started taking off. Mortgage interest rates are currently lower than they were even back then, though, so it’s no wonder our first quarter sales numbers for 2020 were so strong.”
“Obviously, we are not expecting a repeat performance in Q2 due to the coronavirus outbreak,” added O’Connor. “While we expect prices to remain stable through Q2, we will certainly see a reduced number of completed transactions.”
Source: Florida REALTORS®
In April, Colorado saw new listings decrease by more than 35 percent YoY. Active inventory and sold listings were also down, by 20 percent and 23 percent, respectively. Median sales prices, however, remained relatively flat, decreasing only 1 percent for single-family homes. In addition, Days on Market decreased 13 percent statewide to 41 days. Months of inventory also decreased, by almost 17 percent YoY.
“While the real estate universe paused with bated breath in April, the results of a complicated, pandemic-driven start to the typical buying and selling season weren’t nearly as bad as many in the industry feared,” according to a blog post by Marty Schechter on the Colorado Association of REALTORS® website.
Source: Colorado Association of REALTORS®
In the first quarter of 2020, closed home sales increased 10.1 percent YoY to 17,630. The median and average sales prices of homes also increased, by 7.7 percent and 8.0 percent, respectively. Pending home sales also increased, by 5.2 percent to 21,448. New listings were up by 5 percent, increasing to 23,396.
“Housing markets had a strong first quarter,” said Terre Haute’s Bernice Helman, 2020 president of the Indiana Association of REALTORS®. “The drop in March pending sales is likely due to COVID-19, but closed sales and prices held with considerable increases. It is impossible to predict how housing markets will perform over the next several months. What REALTORS® do know is, Hoosiers’ housing needs don’t stop because of a virus. Real estate remains an essential business in Indiana and REALTORS® have many tools to get our clients to the closing table in this time of social distancing.”
Source: Indiana Association of REALTORS®
Real Estate Hot Spots
According to a new report from realtor.com®, several key markets are performing better than others amidst the pandemic. Better-performing markets tend to be smaller cities or locations outside larger, more expensive metros, according to the report.
Here are the 10 hottest markets:
1. Colorado Springs, Colo.
2. Fort Wayne, Ind.
3. Topeka, Kan.
5. Pueblo, Colo.
6. Columbus, Ohio
7. Modesto, Calif.
8. Lafayette, Ind.
9. Sacramento, Calif.
10. Fresno, Calif.
“We’re seeing the continuation of earlier trends where we don’t expect the smaller, more affordable markets to cool down anytime soon,” said Javier Vivas, director of economic research for realtor.com®. “But “for markets to remain hot, they’ll need to have an abundant supply of homes and a thriving job market. Markets like Pueblo are attracting buyers that have been priced out of Denver. Home-buying demand has been pushed out of the bigger cities and into adjacent, [smaller] cities that tend to be lower-priced.”