How has Covid 19 impacted real estate?
You may have heard of the Covid. It's been the topic of conversation on the tips of everyones tongues since March. I'm going to do one thing here, I'm going to talk about the mechanics of what we've seen so far this year in our local real estate market and how the virus has impacted it. This article is not designed to take any sides about right, wrong, fake, real, Bill Gates, Donald Trump, gps tracking devices, masks, or anything else that circulates social media.
Stats, personal experience, and facts only
January and February was insanely busy in our local market. There was some chatter about a virus in China but it had absolutely no perceivable impact on our market at all. Business as usual, fast paced, rising prices and a very competetive environment. The stock market hit record highs and interest rates were good and also pretty stable.
March was the longest month on record with over 276 days. The United States, the greatest country on Earth, ran out of toilet paper and butt wipes. We had food shortages and a legit full blown panic. Yet people kept buying houses.
March was the most volatile month in terms of mortgage rates in history. There were days where the interest rates on mortgages changed close to 100 times in 24 hours. There were mornings where you could lock a rate below 3% and later that day it was 5%. Nobody seemed to know what was what and many buyers exited the market. At the same time many sellers decided to wait it out as well which led to a drastic drop in our already low inventory. Mid march there were less than 700 homes for sale in El Paso County (population 732,000).
Then the so called quarantine. The state in its infinite wisdom made some swiss cheese rules that sometimes applied to some people and not to others but sometimes to others but not to all and then only sometimes but not always. Without going into too much detail this kind of divided the real estate community into 2 camps, the people that legitimately tried to isolate from the public and the agents who worked the gray areas in the rules to continue working. Buyers and sellers were kind of the same way, some didn't want anything to do with the market and others were eager to get in. I personally had maybe 3 or 4 buyers back down from the market during this time while others rushed in. Very weird time the quarantine. #GratefulforCostco
Then April 27th the state said we can go back to work for realsies. And it was like we had the market on pause and then someone hit play. The market just picked up where it left off except with masks, gloves, hand sanitizer, no open houses for a while, strict limitations on showings and a general sense of unease. By this point mortgage rates had not only stabilized but plummeted which made homes feel more affordable. We were back to competing with multiple offers on most decent houses.
The biggest difference in the market is in the lending world. Lenders as a whole have added a myriad of new rules and hoops to jump through. The good news is unlike 2008 lenders are indeed still lending. The bad news is that many lenders have a ton of new "Covid Rules" that are just honestly more of a pain in the ass than anything. The requirements have tightened some, the lag times on underwriting seem to have gone up, the conditions underwriters have been coming up with are increasingly annoying but the bottom line is lenders ARE STILL LENDING and money is cheap.
Summer so far has been record breaking. We're seeing multiple offers on many homes especially in the sub 400k price ranges. Median sales price set a new record in July at over $376,000. So far in August the median is pushing $380,000. If Covid was to call the real estate market it would get a text back that says "new phone, who dis".
And hey I don't want to come off as insensitive or like I don't take this seriously or something. I know people that have gotten very ill with Covid, I know others that had it with basically no symptoms, and I know a whole bunch of people that got their doctorate in epidemiology from the University of Facebook in the last few months. I see the same news you see, and this is the news to date from the local real estate market. It is absolutely booming.
I do market updates every Friday where I dive into whatever is happening that week with all the latest stats and insight. Check those out if you like perspective! And thanks for visiting our site.