March 22, 2020 – Life is quickly evolving to deal with the impending COVID-19 pandemic. We expect all of this to have serious effects on the local real estate market, but most of the publicly available statistics are too lagging to give us real insight into what’s going on right this moment.
In an effort to report to our clients and customers in real-time, we’ve starting pulling the raw data out of MLS, importing it into our own databases, and displaying the trends we can see. We expect we’ll continue these types of report until the end of the crisis. Our role is to educate and inform our clients so that they can make the best decision in an ever-changing market. During the financial crisis that started in 2008, we were a leader in problem solving, and a resource for the latest information. Today we return to that role with another decade of experience to share.
The first thing we were interested in looking at was the number of closings and whether perhaps buyers were canceling their escrows. As you’ve heard us say before, buyers can back out, sellers not so much. Buyers may have to leave their earnest money behind, but if there is a market panic, we’ve certainly seen that done without hesitation. Sellers usually don’t have contingencies that allow them to back out of the deal, so it’s much more difficult for a seller to change their mind.
As you can see from the above graph, it doesn’t appear that there is a recent downward trend in closings.
We then looked at the average sales price of recent closings to see if there is any trend regarding the types of properties that are selling. As you can see from the above graph, there is no real trend that we could tell except that there seems to less variety in the kind of properties that are closing.
This is the graph that we feel tells the most important story right now. This is a look at new residential contracts for purchase. As you can tell, there is a steep decline in new contracts which will show up in the closing numbers soon. We’ll continue to watch and report on this trend as the data becomes available.
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