While virtual tours have been the life preserver that the housing market needs to stay afloat in the current economic climate, the market is still drifting further and further away from its strong showing earlier in the year. At the beginning of March, listings were up 5 percent from the prior year. By mid-April, they fell 47 percent, and the price growth was slowing down dramatically as well, even with low housing inventory. Though the nationwide crisis will be felt in most cities, some will be hit harder with steep drops in housing prices thanks to unstable conditions even before the pandemic hit. Find out how the coronavirus will affect housing prices in your city.
Both homebuyer and seller demand have weakened dramatically in the last month, as Americans hunker down to help stop the spread of the coronavirus.
While some are still shopping online, doing virtual tours, the spring season was essentially over before it started. Although sales are way down, home values may not suffer as much, except in certain markets.
Home prices were very hot at the beginning of this year and heading into the crisis, and the expectation is that while the gains in values will likely slow, prices will not fall nationally. That is because unlike during the subprime mortgage crisis, when there was a serous glut of homes for sale, there is now an increasingly severe shortage. Home values fell as much as 50% in some markets a decade ago, but market dynamics are far different now, and the supply-demand imbalance favors stronger prices.