COVID-19 cases have surged recently, and it has already impacted the housing industry. For the week ending July 12, the amount of listings under contract dropped 15.3% nationally compared to the previous week, according to Forbes. The drop brought the industry down to a level unseen since mid-May, but numbers remain higher than the lowest point in April. HouseCanary, a residential real estate valuation company that conducted the market report, says the virus resurgence may impact the chances of a V-shaped recovery. The contract volume for properties priced $200,000 and below decreased by 11.9%, whereas homes priced between $400,000 and $600,000 dropped 18.1%.
The overall decrease corresponds with the latest reading of the Mortgage Bankers Association’s seasonally adjusted mortgage purchase index, which declined 6% in the week ending July 10 (following waning gains, punctuated by small drops, in the last month or so). After several weeks of seemingly frenzied shopping, which in some cities resulted in bidding wars, home buyers now appear to retreat from the national real estate market.
“The spring-summer buying season has been extended out because of the shelter-in-place,” rules earlier this year, Sicklick says. “But we're seeing these real declines in properties going under contract in all of the major markets where Covid-19 is surging.”