Dramatic Short Term Changes Show That One Segment Of the Market Should Act Now
What the data is showing since the true effects of the coronavirus are hitting the Real Estate market
We now have a better indication of what is happening since the coronavirus landed upon us in full force. My belief based on historical trends in real estate is that we will shift to a buyers market while slowing down and holding steady for a while. I outlined that in my last blog.
It may be important to make the right decision now
This chart shows us the reason that the market has acted as it has has since the coronavirus hit us here in Pinellas County.
If you hover over the columns, you will see that there was a massive increase in pending listings from December until January, almost 50%! This ensured a lot of closings for the next 30 - 45 days and this is why, I believe that we saw fairly steady sales numbers until now as those are clearing out. April stats are not available of course however, the decrease in pending listings is a sign of change.
One interesting statistic, which may be indicative of a switch towards a buyers market is the increase of listings in March over February. While this is normal as we come into our season here in Clearwater Florida, the fact that it was a positive number even though activity overall, is a positive sign.
Looking at the last two time periods of the past 20 days and the 20 prior to that, here is the change in listing numbers. There is no graph for this so I did a custom search.
Source: Matrix MLS April 20th 2020:
Last 20 days: Sold: 890 Listed: 690
Purchases - down 39% Listings - down 19%
Prior 20 days : Sold: 1464 Listed : 858
These numbers are indicative of a slowdown however prices have not yet moved very much and, as mentioned before, listings are down only half what purchases are.
As long as we can get the economy back to as near normal as possible or at least moving in that direction, we should see a decent hold on prices in Pinellas County prices The time for a change was coming based on economic reality however we have not been back to the peak prices of 2005/6 yet. We may still be in for a robust market by the first quarter of next year, possibly sooner
Considering that is 13 years since the Real Estate market crashed in Pinellas, this indicates that we may not be chronically affected in the long run. Online indicators are that many people are searching for homes in Pinellas County Florida. This may be due to the fact that they are at home more or it could be that people do want to move and are finding the time to check the market out. Restricted travel to Florida is definitely affecting the amount of properties being purchased.
Right now much is uncertain which means that change is certain. Regardless, there is always opportunity. People are buying and inventory is still low, that may change. Inventory, that is. Indicators do not show that purchase numbers will drop dramatically however, prices may go down. To what extent will be determined by:
- the time it takes for the market to recover
- the sentiment of buyers and
- the amount of inventory which comes onto the market.
If I were a seller today, I would seriously consider getting my home on the market while prices are remaining fairly steady. There does not seem to be a scenario in which they will go up. In fact the opposite may be true. As in many market shifts before, people have waited too long and ended up kicking themselves for not selling or buying when the time was right. If you study the situation too long, you may be left holding the bag, so to speak. Check your current home value here
If I were a buyer, I would look long and hard at what is on the market, especially properties which have been listed for a long time due to overpricing. This is the time where you may find some "panic "sales". I am dealing with a seller who is in that situation right now. He had to make a huge price drop after turning down a few good offers many months ago which will not be coming again. There will also be properties listed by people who need to move now. Many may list at a price to move now which may be below current market value.
Keep a lookout for the next post on market values and trends. In the meanwhile stay safe and contact us for any real estate needsor information.