Murrieta Market Snapshot | March 2020 | Coronavirus Update

How did the Covid19 stay at home order affect the Murrieta/Temecula housing market last month in March?  That’s what we’re talking about today and we are starting right now.

Hi, Jessica Genung here, and if you are new to my YouTube channel, welcome and thanks for checking out my video.  I am a Realtor here in the Murrieta/Temecula Valley and we make these videos to educate those of you that are interested in learning more about the local housing market.  We put out a new video every single week. 

At the end of the video I’ll go over the March numbers which actually look very similar to my other market reports in recent months.  The effects of the shut down were not really reflected in the March numbers, but it’s having a major impact on the housing market.  Real estate is considered a lag business and although it is not reflected in the numbers yet, it has been rocky lately. 

The way we do business is changing completely, there are no open houses being held and in person showings have been drastically reduced.  Here is my opinion about if it is a good time to buy or sell a home right now.  I liken the activity to what the real estate market feels like over the Christmas holidays. Activity over the holidays is way down, but those that are in the market at that time are typically more serious buyers and sellers.  

Seller’s who list their home in December are typically quite motivated, and buyers can often negotiate a better deal during these off times than during the busy selling season.  So you may be wondering, is now good time to sell?  Depends on if you NEED to sell over the next few months.  Now is not an ideal time to sell. I’ll be blunt about that. 

But if you know if you need to sell soon, I recommend putting the home on the market ASAP because it is my opinion that we are at the beginning of a slow decline.  You will not likely sell for the price you could have received a month or 2 ago, but it’s my opinion that the next few months it will likely get worse before it gets better.  So if you do not need sell, then you may want to wait because buyer activity is very low. Most folks are staying home.  

So, if it’s not a great time to sell, is it a good time to buy?  It is a much better time to buy right now, than it was even just a month ago.  We have been in an extreme seller’s market lately with lots of multiple offers.  But not anymore.  Highly desirable properties are much easier to win at the current time.  

For example, my buyer just went under contract about a week ago for this property in Temeucla’s Redhawk neighborhood.  It had just fallen out of escrow because the previous buyers had issues with their loan due their lender tightening up their credit requirements.  On VA loans in particular right now, some lenders are adding what they call “overlays.”  

A mortgage lender overlay is a qualification requirement applied by a lender that exceeds the standard qualification guidelines for a loan program. … In short, applying overlays means that lenders use tougher borrower qualification requirements than they are required to according to general mortgage industry guidelines.  In this case, the lender’s minimum credit score requirement was raised while they were under contract, and the buyer could no longer get the loan.  

When the property came back on the market, we were not up against any other offers.  This property has great features: it’s located in ahighly desirable Temecula neighborhood, fantastic view lot, remodeled throughout including a new kitchen and master bathroom, its in a low tax area, zoned for Great Oak High School which has a 10/10 Great Schools.org rating. 

Lastly, the home has only a $35 HOA fee and they have a community pool and spa- which most of Redhawk does not have. Just this small collection of homes.  I’m positive this would have been a multiple multiple offer situation even just a month ago.  So if you are well qualified, now may be the time to buy.  I’m also seeing sellers more willing to pay buyer closing costs and I’m seeing some price reductions as well. 

Real quick, if you are a Southern California property owner, and you’re curious about our opinion of the value of your home, I have a link below in the description that you can fill out. We will be happy to send you a home valuation report.  

Let’s take a look at the Murrieta numbers.For simplicity in my market reports, these stats are based only on single family detached homes and only in the city of Murrieta.  We are comparing March of this year vs March of last year 2019. We usually focus mostly on current month versus the same month prior year, but I’ll add current month to PRIOR MONTH this time.

Ok, let’s start with Average sales price. Average sales price for Single Family Homes in Murrieta is UP 9.1% from 469,124 last March to 511,697 this March. Compared to February 2020 this year with $518,836 the average sales price is down $7k or 1.4% and that could be the first sign of a Coroniavirus impact.

Closed sales went way up compared to both prior year and prior month.  Up 17.6% from 153 March of 2019 to 180 this March in 2020 and up 21.6% from 148 last month. This is typical seasonal activity with March having more closings that February in a typical year.  

Days on market is down 28.6% with 40 in March 2020 compared to 56 March 2019 and 50 in February 2020. Homes are selleing quicker

Lastly we have Number of Listings which is down 41% with 316 compared to 537 last year.  This demonstrates the inventory shortage is continuing on the trend pre-CV-19.  Last month with 308 in February is basically flat, but this is something to keep an eye on closely. We plan to run weekly reports in what we believe to be a highly fluid market right now that could change week to week. 

March started out as a strong month for the U.S. housing market — but by the second half of the month, the first indications that the coronavirus pandemic would weigh on home-selling activity began to emerge, according to a new report from Realtor.com.

In the weeks ending March 21 and March 28, the number of newly-listed properties fell by 13.1% and 34% respectively when compared with the same period a year ago, Realtor.com found. This is an indication that home sellers may be holding off on listing their properties right now.

The pace of home-price growth also slowed notably in the latter half of the month, according to the report. Home list prices were only up 3.3% year-over-year for the week ending March 21, and 2.5% for the following week. This represented the slowest pace of listing price growth since Realtor.com started tracking this data in 2013.

Only 1.8 months of inventory translates to a shortage of housing, but this month is a slight uptick from 1.7 last month.

So what do you think? Is the Corona virus going to damage the housing market like it is on the stock market and economy overall?  Will the economic stimulus efforts get us back on track right away? Tell us what you think!  Thanks as always for watching my video and I’ll see you on the next one.