It's still too soon to say if homebuying demand will suffer a relapse, and the road to a full recovery is long; in January and February Redfin's homebuying demand was up 27% compared to the prior year.
The improvement in homebuying demand is especially notable because this year Easter fell on
Digital commerce is the best medicine for real estate
This past weekend, nearly one-third of Redfin's home tours were conducted via video chat. Now buyers are writing offers based on those tours. For the week ending
While the coronavirus outbreak has prompted consumers to change their behavior, it's a change Redfin agents think is here to stay.
Last weekend, Redfin also began piloting its Direct Access technology with vacant listings in
The big question is whether homebuying demand will turn into sales
Redfin is still hearing reports of bidding wars from agents in markets across the country, especially for affordable homes and homes in historically desirable neighborhoods.
Despite these pockets of activity,
Pending sales are declining while homebuyer demand is strengthening because many sellers are sitting on the sidelines. There are currently just over 750,000 homes for sale in the
Prices have been stubborn, but homes are sitting on the market just a little longer
A 50% decline in pending home sales would normally lead to a drop in prices, but the lack of homes for sale is keeping prices relatively stable. The median listing price fell from
Redfin still hasn't seen an increase in price reductions, but homes are starting to sit on the market just a little longer. Homes on the market have been listed for an average of 64 days, up from a low of 58 days earlier in March. If homes sit longer, prices may slide further.
Completing a sale requires patience and more flexibility than ever
Health concerns, stay-at-home orders, and lenders overwhelmed by refinance applications are slowing down transactions.
Shadows loom over the mortgage market
The biggest storm cloud on the real estate horizon is that credit is getting harder to come by. Last week Redfin reported limited availability of both jumbo loans for higher-priced homes and FHA loans targeted at first-time buyers.
This week, lenders raised credit standards even for conforming loans that are guaranteed by Fannie Mae and Freddie Mac. On
With unemployment claims at almost 17 million and 11% of
The catch is that the banks servicing loans in forbearance still have to front the monthly payments to the investors who purchased those loans. So while the Fed shovels money into the mortgage-backed securities market to keep 30-year mortgage rates below 3.5%, lenders are restricting credit so only borrowers with stable incomes and sterling FICO scores have access to it. Hopefully Chairman Powell starts directing a portion of the money earmarked to stabilize housing towards mortgage servicers soon.
To read the full update, please visit: https://www.redfin.com/blog/stable-home-prices-low-inventory-coronavirus/
To view charts highlighting more housing data from this past week, please visit: https://www.redfin.com/blog/coronavirus-upending-housing-market/
Redfin is publishing this housing-market update as a way to inform our customers, not our investors. Even though we're notifying investors through a government filing about this customer update, we're not updating, withdrawing, or affirming the first quarter financial guidance we issued on
Redfin (www.redfin.com) is a technology-powered real estate brokerage, combining its own full-service agents with modern technology to redefine real estate in the consumer's favor. Founded by software engineers, Redfin has the country's #1 brokerage website and offers a host of online tools to consumers, including the Redfin Estimate, the automated home-value estimate with the industry's lowest published error rate for listed homes. Homebuyers and sellers enjoy a full-service, technology-powered experience from Redfin real estate agents, while saving thousands in commissions. Redfin serves more than 90 major metro areas across the
For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the
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Redfin Journalist Services: Isabelle Novak, (414) 861-5861, email@example.com