The signs of spring are everywhere. Daffodils are blooming, tulips are not far behind. Buds are popping on trees.
This is also the time of year, when house for sale signs pop up as quickly as those daffodils. But not this year.
This is supposed to be the best time of year for real estate sales. Open houses, for sale signs, closings, a vibrant and exciting time for buyers, sellers and realtors.
But now it’s hard to find a for sale sign. The COVID-19 pandemic has locked down this economy, including the real estate market.
Open houses are prohibited as governments crack down on all kinds of activities to limit human contact. The economy is troubled and its future, after the pandemic has passed, uncertain.
You’ll find hopeful messages from realtors, but that’s the sales pitch.
“It’s killed,” is how one veteran realtor at a prestigious Rhode Island firm described the industry.
“There are no open houses, and for deals already in effect there are all kinds of problems,” he said. “City and town halls are closed. Title searches can’t be done. Firemen won’t come into houses for smoke alarm inspections.”
While open houses are prohibited, the Rhode Island Association of Relators website said realtors are still “allowed to have individual showings with buyers – no more than five at the showing, preferably less.”
Mortgage rates that were low, are now what one real estate website says are “zigzagging.” That same website is predicting rates will remain low and maybe go lower.
But the coronavirus, the shutter in place orders, uncertainty about the economy generally, and projections of a possible recession have shaken the industry.
CoreLogic Chief Economist Frank Nothaft, said on the company’s website that “data for the week ending March 22nd suggests that home-purchase mortgage applications, availability of homes for sale, and the number of home-purchase contracts signed are all showing weakness due to COVID-19, particularly given that this is typically the ramp up to the spring home-buying season. Rental applications among prospective tenants also appear to have dipped as many households are required to ‘shelter in place’.” CoreLogic provides information intelligence to identify and manage growth opportunities, improve business performance and manage risk.
Update – The U.S. housing market began to show signs of slowing in the second half of March as the year-over-year decline in inventory softened, the number of newly listed properties declined and prices decelerated compared to earlier in the month, according to realtor.com®‘s March Housing Trends Report that was released at 9 am today. The monthly report provides the first data-based glimpse into the impact the COVID-19 pandemic could have on residential real estate as the market enters the spring home-buying season. Read the full report.