Market slows down as buyers and sellers feel the effects of the coronavirus financial turmoil
After a strong start at the start of the year, the US housing market started to show hints of a slowdown in the second half of March as the impact of coronavirus continues to take shape.
Realtor.com's housing trends report showed that inventory and the number of newly listed properties were down and prices decelerated compared to earlier in the month.
In the latter half of March, homes for sale nationwide fell 15.7% year over year, a faster downturn than the 15.3% decline in February. This means 191,000 fewer homes for sale.
Meanwhile, housing inventory hit a five-year low in the last full week of February, down 16.8% before decelerating to a 15.2% year-over-year drop during the weeks ending March 21 and 28.
Realtor.com Chief Economist Danielle Hale said that inventory and listing data can give some early insights into how COVID-19 affected the housing markets but is limited as the situation and its effects are still rapidly changing.
The coronavirus pandemic may have also taken its toll on the interest among potential home sellers and buyers. Data from realtor.com suggests that sellers may be rethinking or halting their plans to list their homes for sale. In the last two weeks of March, the volume of newly listed properties dropped by 13.1% before plunging 34%.
Additionally, price appreciation slowed down during this period. The median US listing price climbed at a 3.3% and 2.5% year-over-year pace – the slowest since realtor.com began tracking in 2013.
"The US housing market had a good start to the year, Hale said. "Despite still-limited homes for sale, buyers were buying, and builders were building. The pandemic and virus-fighting measures appear to be disrupting that initial momentum as both buyers and sellers adopt a more cautious posture."
