According to a new report from Redfin, home sales and the number of homes listed for sale plummeted in the face of the U.S. coronavirus crisis in March.
At the beginning of the month, the housing market was strong, with February marking the eighth straight month of increases in home sales, and the U.S. economy was relatively stable. By the end of March, that run had come to an end, and everything had been thrown into extreme disarray as the spread of the coronavirus turned the housing market upside down.
In turn, the picture for the entire month of March will understate the stalled condition of the market heading into April.
March home sales, which were only partially impacted by the coronavirus shutdowns, dropped 9.1% nationwide from February on a seasonally adjusted basis – the largest decline since at least January 2012, when Redfin began tracking the statistic. Home sales also fell 1.2% year over year in March, the first decline in nine months, and by the last week of the month they were down 11.5% from the same period a year earlier.
The markets with the biggest declines in home sales from a year ago were all in New York: Rochester (-18.5%), New York (-18.3%) and Nassau County (-17.3%).
“The impacts of the coronavirus hit the economy hard in mid-March, as we have been reporting in our weekly data, but it’s good to step back and take an aggregated look at the market,”
“Real estate activities nearly ground to a halt in some parts of the country by the end of March, disrupted by shelter-in-place laws,” says Redfin lead economist Taylor Marr.
“Right now, sellers need to decide if they’ll list their home for sale among all the economic uncertainty. On one hand, the number of homes for sale is down more than 20% in recent weeks, even more than the 13% drop we saw for the full month of March, and home prices have so far held better than anyone expected,” Marr says. “On the other hand, jobless claims continue to pile up, and it is getting increasingly difficult to get a mortgage, which could limit buyer demand. How the market shapes up through the rest of spring will depend heavily on unemployment and the availability of credit.”
The number of new listings also plunged in March, dropping 10.8% compared with a year earlier. This is by far the largest decline on record, but more recent data is showing it may be even more severe. By the last week of the month, new listings were down 36.9% from the same period a year earlier; as of last week, they were declining nearly 50%.
To read the full report, click here.
Photo: Taylor Marr