As Santa Clara County closes in on week eight of sheltering in place, and the nation as a whole faces 'speed bumps' on account of the global pandemic – there has been some surprising news in real estate. You’d be hard-pressed to name an industry that has not been hit by COVID-19 (unless you are making Clorox wipes or toilet paper!), so it is no surprise that Bay Area home sales have dropped 30% and listings have fallen 44% in SCC and 4 surrounding counties. Just this week, housing is making progress as agents are now allowed to show homes privately (no open houses) as long as occupants are not present.
While only time will tell how long the ‘dip’ may last, several news sources have pointed out some noteworthy trends. Details are below, but in short, purchase applications have risen for the 3rd week in a row, Silicon Valley starter homes are still seeing multiple offers from first-time home buyers, and luxury and second home markets are going strong in several areas of the country.
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According to the Mortgage Bankers Association:
| The nationwide weekly volume of purchase loan applications rose 6% on a seasonally adjusted basis, and 7% on an unadjusted basis.
| California loan volume increases ranked in the top 3 states in the nation, up 10.1%.
| These numbers represented the third consecutive weekly increase.
As reported by the Mercury News:
| The ‘roaring Bay Area home market’ will see ‘few price retreats and discounts’ according to analysts.
| Agents report that the area’s long-standing supply shortage still means multiple offers on desirable starter homes.
| Serious first-time home buyers are taking advantage of low rates and overall slower activity (i.e. less competition).
According to the Los Angeles Daily Times:
| Home sales in the $5 million and even $10 million range are still going strong (82 home sales this year compared to 85 during this time last year).
| Legacy homes are selling at ‘reasonable’ prices when all other price ranges have ‘seized up’.
| Those who could pay cash are instead opting to obtain a loan since rates are near historic lows.
The Laconia Daily Sun confirms:
| The luxury market remains solid; new listings are being priced at pre-pandemic prices.
| Lack of second home inventory, waterfront properties on the east coast are going into contract within days on market.
| Agents report more homes over $1 million under contract or sold compared to this time period last year.
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Whether your short- and long-term buying, selling and investing goals have changed or remained the same in the last 8 weeks, please know that we are always here to help you navigate how to achieve them. Please reach out at any time, with any questions, without obligation.
All my best,
Mark Barber, Homes of Silicon Valley
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