Homeselling to See Rise Following Shelter-in-Place Orders

The National Association of Realtors (NAR) reports that 77% of potential sellers are preparing to sell their homes following the end of the stay-at-home orders. 

“After a pause, home sellers are gearing up to list their properties with the reopening of the economy,” said NAR Chief Economist Lawrence Yun. “Plenty of buyers also appear ready to take advantage of record-low mortgage rates and the stability that comes with these locked-in monthly payments into future years.”

The NAR’s Economic Pulse Flash Survey revealed that 5% of realtors said clients are shifting neighborhood preferences from urban areas to the suburbs due to COVID-19, and 13% reported buyers have changed at least one home feature that is important to them. 

Additionally, 73% of realtors said their clients haven’t reduced listing prices to attract buyers. This comes despite a significant number of buyers expecting sellers to drop prices. The survey found that 21% of buyers are expecting prices to drop by 5-10% and that 6% of buyers are expecting prices to fall by 11-15%. 

The survey also found that 42% of buyers are delaying purchases by several months and that 17% have stopped looking due to COVID-19. Sixteen-percent said there was no change to their buying strategies. 

Buyers looking to delay purchases do not bode well for the spring homebuying season, which Zillow forecasted a 60% drop in home sales this spring. 

The forecast calls for a 2-3% drop in prices through the end of the year, followed by a steady recovery throughout 2021. Zillow says home prices could recover at a pace of about 10% each month through 2021. 

"Much uncertainty still exists, particularly with some states beginning to reopen and experts warning of a possible second wave of the coronavirus in the fall. However, housing fundamentals are strong -- much more so than they were leading into the Great Recession—and that bodes well for housing in general," said Dr. Svenja Gudell, Zillow's Chief Economist. "Despite the difficulties, we're seeing several signs that there is still a good amount of demand for housing, and buyers, sellers, and agents are growing more comfortable moving transactions forward where possible. For those who need to sell, buyers are out there, and there are ways to embrace technology and practice social distancing to ensure a safe process."

Zillow Chief Economist Svenja Gudell said that technology is helping move transactions forward, and its 3D home tours have increased by 600%.