2020 Housing Market | Coronavirus Impact | Murrieta Ca
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by christopher.genung
- March 18, 2020
- Uncategorized
- 0
2020 Housing Market | Coronavirus Impact | Murrieta Ca
Wondering how the real estate market is going to be affected by the Corona Virus? Maybe you are wondering if it’s a good time to buy a house right now? Should you hurry and sell sooner rather than later? These are the questions that we’re going to tackle today and we are starting right now…
Hi I’m Jessica Genung, and I’m a Realtor here in the Murrieta/Temecula Valley. Thanks for
checking out my channel and if you want to keep up to date on the local real estate market go ahead and smash that subscribe button and that bell icon so you can be notified when I post a new video, which is every week.
I am going to cover a lot of ground in this video. I’m going to talk about the effects of the coronavirus on my business personally, I’m going to tell you what other Realtors surveyed on the issue had to say, and I’m going to discuss how we can guard our minds and make sure that who and what we are listing to isn’t making a bad situation worse.
On March 9th and 10th, the National Association of Realtors conducted a flash survey of members on the impact of the Coronavirus in their market. This survey was conducted after the initial interest rate drop and after the stock market approximate 20% drop. The survey was about a week ago and things are rapidly changing. The survey report looks at the effects on these three areas: mortgage rates, buyer interest and seller behavior.
I will emphasize the March 9 and 10 date because this was before schools closed here in Murrieta and Temecula in Riverside County. The survey was before the panic runs on the grocery stores. In my mind, the Coronavirus was more of distant global issue then it came to the US in Seattle / Washington State and now hit close to home with all the cancelations of school and public gatherings like church and sporting events.
Mortgage Rate Change NAR Slide 1
The majority of sellers have decided not to make a change in their home listing. However, in California 12 percent of members cited the number of sellers have increased because they can take advantage of lower interest rates upon moving and the purchase of their new home.
Mortgage Rate Change Cont. NAR Slide 2
Half of members cited there was no notable change in client behavior regarding the stock market and mortgage rate change. More than one-third of members cited clients are excited by the lower mortgage rates more than they are concerned over the stock market correction. Thirteen percent cited the stock market correction significantly damaged confidence, and lower rates do not offset this.
Buyer Interest NAR Slide 3
The majority of members reported there has been no change in buyer interest due to the coronavirus. In California, 21 percent of members cited a decrease in interest. That is the 16% and 5% in yellow and red on the left side of the bar chart.
In my business I am still seeing normal buyer interest. But I did have a conversation with one of my buyers that is currently in escrow and set to close on a home in April say that he may possibly want to ask for an extension to see how things go with the crisis. He said he’s not at that point yet, but would like a little flexibility of time to feel out how serious the virus effects are going to be.
Folks
are concerned and fearful right now, and when that happens, they don’t want to
make big decisions until they have more clarity. It seems like this virus
is not going to go away 100% anytime soon, so I know I am praying for quick
control of the spreading of the virus and quick recoveries for those infected.
If all goes well, I think business and life will keep chugging along in a positive
way.
For
myself, for many years now, I try to limit my intake of the daily news.
We need to be informed, but my decision to limit my daily news intake keeps me
in a more positive mindset where I can focus on the things around me that I
have some control over.
So with that being said, I want to encourage
people to not get sucked into the hysteria and drama, which can lead to fear,
anxiety and irrational behavior. A great way to stay informed about the
status of the coronavirus instead of watching the speculation and drama play
out on the news is to check out this link:
This
website has the stats on infections, deaths, and very importantly, the
recoveries. It breaks it down by country and each state in the U.S. I
think the news and the media in general is feeding into disaster
mindsets(catastrophizing if you will), and all the concern is important and
valid, but there needs to be balance and logic to it too.
Getting
back to the survey…
Seller Behavior NAR Slide 4
The majority of members reported there has been no change in seller interest due to the coronavirus. In California, 14 percent of members cited a decrease in interest. That is the 12% and 2% in yellow and red on the left side of the bar chart.
Seller Behavior Cont. NAR Slide 5
Most members reported there was no change in sellers removing homes from the market due to the coronavirus (COVID-19). In California, four percent of members reported homes were removed from the market.
In my business, one of my seller’s that we are listing their home in about 2 weeks, contacted us asking if we should move up the listing date due to the Coronavirus. In their individual situation we advised them to stick with the original plan. So I’m wondering if the crisis will energize more sellers that have been waiting or are on the fence to put their property on the market so they can try to lock in the gains they’ve accrued over the last few years. If the result in our market was more seller’s decided to sell, I think that would be a very positive thing. We have currently been in an extreme seller’s market with multiple offer everywhere and I would love to see more balance. I think that would be healthy. Of course we still need steady buyer demand to achieve balance.
Lets talk briefly about interest rates. You may have heard the Fed just took the most dramatic steps since the 2008 financial crisis to bolster the US economy by lowering interest rates to zero as part of wide ranging emergency intervention. They also said they will buy at least $700 billion in government and mortgage related bonds. In addition to rate cuts, the Fed announced it’s restarting its bond purchase program known as “quantitative easing.” I haven’t heard that phrase in a while. The Fed chair Jerome Powell said they anticipate a “significant” effect on the US economy in the coming months including negative growth in the second quarter. The goal being to help the economy “weather this difficult period” and “foster a more vigorous return to normal once the disruptions from the coronavirus abate.”
Our last slide on the survey:
Seller Behavior Cont. NAR Slide 6
A portion of sellers are changing how their home is viewed while the home remains on the home selling market. About one quarter of home sellers nationwide have made changes including stopping open houses, requiring buyer handwashing or hand sanitizer to be used, or asking buyers to remove shoes or wear footies. In California, 34 percent of sellers have adopted these or other changes.
In my business, seller’s are still wanting their homes, they are wanting to accommodate showings and still have open houses. We are working with sellers and taking precautions to keep everyone safe such as the changes I discussed in the survey. We are asking guests to removed their shoes or wear booties, use hand sanitizer upon entering, and we are wiping off door knobs and surfaces before and after the open house.
Our office is also taking precautionary measures. Our office is closing this week and office staff has been asked to work remotely. They’ve also advised us to make as many of our appointments as possible virtual. This is easy for us as we do a lot of virtual touring with out of state clients already and are happy to show buyer’s properties via FaceTime etc. Listing appointments can also be done virtually and we are being advised to do so. With that being said, we are still holding in person open houses as well, and doing in person showings. We are just trying to be cautious, smart about it, and stay educated on the situation. It certainly is not business as usual and we are having to make adjustments.
I hope the info in this video gives you some insight about how the Coronavirus is affecting the real estate market and the impacts on our business. Let me know what you think in the comments below. Thanks as always for watching.
