Before the coronavirus scare, the U.S. housing market's spring selling season
was shaping up to be one of the best in recent memory. Then the coronavirus struck, and sales activity dropped sharply. National Association of Realtors Chief Economist Lawrence Yun said Wednesday that he expects sales volumes for April, May and June to plunge 39 percent compared with the same period in 2019.
As for pricing, Yun pointed to a survey of Realtors that showed similar results to Weiss Analytics' conclusion. Fully 73 percent of agents told NAR that sellers weren't discounting prices, while the other 27 percent reported discounts of varying levels.
"The prices they are putting on the market today would be essentially the same as before the pandemic," Yun says. "So the home sellers are very patient. No panic."
More than 36 million Americans have filed unemployment claims since mid-March, so a steep decline in sales volumes is no surprise. The bigger mystery surrounds home prices, which tend not to fall rapidly — a trend economists refer to as "stickiness."
Many homeowners opted not to sell at all this spring, rather than trying to show properties during a pandemic and negotiate with bargain-hunting buyers. While that pushed down the supply of homes, buyers also are staying on the sidelines.
"This kind of historic crash in employment has to have a ripple effect that we haven't really felt yet," Weiss says.
Homes priced higher than $600,000 are most likely to be discounted, Weiss says, partly because lenders have pulled back on making jumbo loans. Sellers of some 37 percent of houses in that price range have asking prices below their February values, with a median discount of 7.7 percent.