Despite initially having little effect on the housing market, the coronavirus is starting to make its mark on the industry as fear of its spread increases, especially in areas with confirmed cases such as Seattle. In response, Redfin launched an on-demand virtual tour feature in its app so potential buyers can conduct everything online: They can even close on a house online if state laws allow it. Redfin is unsure if the coronavirus’ effects on the housing market—which are still relatively small at this point—will be short lived, but the company’s digital efforts position it to navigate this virus and any future outbreaks. Even so, the company stresses that it is still confident in the housing market long-term outlook.
Until Sunday, U.S. housing demand seemed unaffected by the coronavirus. The National Association of Realtors reported last week that pending home sales were at the second-highest level in the last two years. But over the past three days in Seattle, where the first U.S. coronavirus death was confirmed on Saturday, February 29, we’ve seen a significant drop in demand from homebuyers and sellers.
Smart People at Redfin Disagree About the Virus’s Impact
Redfin’s demand fluctuates plenty from day to day, especially in a single market, and this may only be a significant but short-lived reaction to the first serious virus infections on the U.S. It could also be more serious, and affect the rest of North America.
Redfin Agents Across the U.S. Mostly Still Confident
The word among our agents, who have been sensitive to demand shifts in the past, especially when rates began rising in the summer of 2018, has mostly been good. In many markets, last week’s stock-market decline seemed to have had a bigger impact than consumer fears about the virus itself. Our agents still report strong demand in the middle of the country, especially Chicago, and in Washington DC, Virginia and Boston.