What is the Market Doing?

Dated: 04/15/2020

Views: 150

In Texas, we're considered 'essential business' by the state. Therefore, business is continuing. Curiosity made me wonder how things are trending. 

Personally, since the 'work from home' initiative began on March 16, 2020 I've had property close, gained new buyers, had buyers elect to wait, spoken with sellers about coming on the market, and have transactions still in process. 

Wanting to know the bigger picture, the MLS (Multiple listing service) of our board has tools available for statistical analysis. Turning there, what do we see? Comparing 2019 with 2020 using single family residential only as the criteria and because our market average is in the $270,000 or so range, prices between $250,000 and $300,000 were selected. 

2019 looked like this:

Single Residential

No. New

Avg. New OLP

Med. New OLP

No. Sold

Avg. Sale Price

Med. Sale Price

Avg. Days

Med. Days

Jan 2019

383

$291,633

$283,000

238

$273,979

$274,945

101

77

Feb 2019

414

$285,176

$283,688

299

$273,289

$274,900

99

76

Mar 2019

486

$283,986

$281,788

383

$274,965

$274,000

95

70

Apr 2019

541

$280,984

$279,000

428

$273,638

$274,000

93

63

2020 So Far (To April 15, 2020) 

Single Residential

No. New

Avg. New OLP

Med. New OLP

No. Sold

Avg. Sale Price

Med. Sale Price

Avg. Days

Med. Days

Jan 2020

518

$277,968

$276,361

287

$272,748

$270,900

88

62

Feb 2020

567

$275,679

$274,900

364

$272,333

$270,000

98

76

Mar 2020

636

$275,829

$275,000

488

$273,044

$272,500

100

76

Apr 2020

259

$273,435

$270,809

139

$270,065

$267,000

80

51

What does this say? 

Certainly it's a matter of opinion, and here's mine. 2020 started quite strong. The number of new listings is higher than 2019, and the number of closed transactions is higher. 

What is the impact of Covid? 

Considering that we're only half way through the month of April and making an assumption that doubling the number of new listings and closed listings creates a reasonable projection to the end of the month, we'd expect to see about 518 new listings for April and 278 closed sales. Take a look at the January 2020 figures and see how similar that is, and it's still much stronger than 2019. Of note, typically more homes close in the second half of the month than in the first two weeks.

It appears the market has softened a bit, but not substantially.

What does this mean going forward?

Making projections is a challenge. Covid is obviously a shock to the systems associated with the transfer of real estate. Those who's employment has sadly been restricted will obviously not be buyers in this environment. Keeping in mind that we were often seeing multiple offers on 'good' properties, we might expect a little less buyer competion. Seeing 'days on market' actually shrinking would lead one to expect good buyer activity going forward. In addition, mortgage interest rates are on the historically low end of the range.

As the Covid associated shock wears off, my educated guess is the market will improve in the fairly near term. We typically see more folks move over the summer during the school break, and I think this will continue this summer to a bit lesser degree than it would have without the pandemic. Sellers, with appropriate safety measures in place, can confidently enter the market. Buyers may see a bit less competition but transactions are happening. 

Markets vary. It's tough to compare areas, and this overview is for specifically Bexar county. 51 days on the market (April 2020 to date) is short and still oriented towards sellers. A six month 'days on market' is considered to be at equilibrium between buyers and sellers, and we're not seeing a trend towards that. 

Yes, it's early and with many unknowns going forward it's hard to say if the trends will continue, but in the opinion of this agent I don't see anything in the current market snapshop offered above which should make one change their plans.

If a move is something you seek and you're comfortable with the associated financial considerations, then go for it. Others are! And we're here to serve you through the process. 

 

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Danny Thomas

Danny’s goal is to be your REALTOR® for LIFE! Your Life and your needs matter most and matching your needs with his expert service will lead you home! Experienced with selling homes, buyer service....

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