Restrictions to prevent the spread of COVID-19 turned what is traditionally the year’s fifth-busiest month for home sales back to numbers traditionally seen in wintertime. Fewer sellers and fewer buyers took a toll on April home sales causing a more than 20% drop compared to a year ago, according the April 2020 RE/MAX National Housing Report.
While home sales and inventory declined in the report’s 53 markets, home prices saw steady gains. In fact, the Median Sale Price of $276,000 was up 9.3% year-over-year. As many states begin adjusting to the new normal and easing some restrictions, current metrics suggest that housing is already showing positive signs of recovery and RE/MAX CEO Adam Contos believes underlying interest in buying and selling remains high. RE/MAX agents are now focused on helping homebuyers overcome the uncertainties brought on by COVID-19, anticipating the velocity of transactions to increase in the coming weeks and months
“April results were better than many expected, as consumers continued to buy and sell real estate in one of the most challenging months for housing in memory,” said Adam Contos, RE/MAX CEO. “This was a headwind like no other – yet we still saw activity across the country. Even in the markets that dropped 40% in sales, people wanted or needed to move, which says something about resiliency and the power of homeownership.”
Four markets – New York, Detroit, Miami and San Francisco – posted year-over-year sales declines of more than 40%. Just two markets – Minneapolis, MN and Billings, MT – reported an increase, while eight saw declines of less than 10%.
Contos continued, “We believe the coronavirus and the measures to slow it pushed the spring selling season back a bit. But we believe buyer demand remains relatively strong despite the pandemic, and sellers who pulled their listings in March or April will hopefully come back into the market this summer. Others may start the process after being stuck in a home that no longer suits them. Both groups could help alleviate the inventory challenges we’ve faced for quite some time. Moving forward, agents who’ve adjusted their business strategies are positioned for success in the more virtual environment.”
Here are some highlights of the latest data found in the RE/MAX National Housing Report:
1. Sales Prices Continued to Climb
No metro areas measured in the report saw a year-over-year decrease in Median Sales Price. Eighteen metro areas increased year-over-year by double-digit percentages, with the largest increases seen in Manchester, NH at +20.0%, Augusta, ME at +19.1%, and Philadelphia, PA at +16.9%.
2. Homes Sold Faster
The average Days on Market for homes sold in April 2020 was 46, down eight days from the average in March 2020, and down seven days from the average in April 2019. The metro areas with the lowest Days on Market were Omaha, NE at 19, Seattle, WA at 20, and San Francisco, CA at 21. The highest Days on Market averages were in Des Moines, IA at 106, Augusta, ME at 95, and New York, NY at 88. Days on Market is the number of days between when a home is first listed in an MLS and a sales contract is signed.
3. The Number of Homes for Sale Increased, but Still Does Not Meet the Demand
The number of homes for sale in April 2020 was down 2.2% from March 2020 and down 18.2% from April 2019. Based on the rate of home sales in April 2020, the Months Supply of Inventory increased to 3.5 compared to 2.9 in March 2020 and increased compared to 3.0 in April 2019. A six months supply indicates a market balanced equally between buyers and sellers. In April 2020, of the 53 metro areas surveyed, five metro areas reported a months supply at or over six, which is typically considered a buyer’s market. The markets with a months supply at or over six were Detroit, MI at 6.8, Indianapolis, IN at 7.2, Miami, FL at 13.5, New York, NY at 12.1 and Pittsburgh, PA at 7.4. The markets with the lowest Months Supply of Inventory were Albuquerque, NM at 1.2, Omaha, NE at 1.3, and Manchester, NH at 1.4.
Whether you’re looking to buy or sell now, or preparing to buy later, a RE/MAX agent can provide help, information, guidance and expertise on all things related to real estate.
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Written by Samantha Rotbart
