As the dust settled following the March shelter in place order, and real estate transactions slowly crept back to pre-COVID levels, it took until July of 2020 for sales to finally start rebounding.
How We Were Affected
We had to change how we do business a bit, as regulations made open houses a thing of the past. No more flyers, paper contracts—everything is now in the digital realm. We already employed virtual 3D tours, drone videos, electronic flyers downloadable from QR codes on our For Sale signs. All of our paperwork is in the digital universe and has been for several years now. In short, we were ready to meet the needs of these unprecedented challenges.
We also employ sanitizing stations at our listings. Showings are limited to a selling agent and immediate family members of the same household. Required is a liability release to protect our sellers, and proof the buyers have been pre-approved and are qualified to purchase the home.
How the Market Rebounded
What surprised us, was following the shelter in-place order how the housing market rebounded so quickly. Especially given the unprecedented times people have endured—the unknowns and uncertainties that typically will cause buyers looking for a home, to take pause.
But it appears the magnitude of the situation had the opposite effect.
Cooped-up buyers began seeking larger homes—and second homes—while taking advantage of record-low interest rates. With sellers being reticent of the throngs of strangers touring their homes. This, compounded by the initial directive stating only vacant homes can be viewed in-person, low inventory levels emerged. The result was predictable—an increase in prices.
The Numbers Don’t Lie
This link shows a macro view—the Case-Shiller 20 major city composite index.
As seen in this index, the 20 major city composite index rose 2% between March and July. The Bay Area specific MSA showed a decline of .4% during the same period.
Why did some Bay Area county’s median home price essentially go stagnant while other’s thrived? It’s because of the make-up in the index, which includes several more price sensitive and volatile counties.
Looking at the semi-macro view—San Mateo County statistics—we see a 1% median home price increase. On a micro-level, Belmont showed a 3% YOY increase for the same period. This illuminates that some cities and counties were harder hit than San Mateo County or Belmont.
What May be in Store?
What’s in store in the coming months? If past performance is any indication of future results, in a Presidential election year—especially in a hotly contested match-up as we’re seeing this year—the housing market typically goes into a stall. Then again, if this year has taught us anything, nothing is predictable…