Market Minute - May 2020
For some this has been a very stressful time, especially for those who had intentions of either buying or selling property this spring.
The good news is in spite of shelter-in-place (SIP) orders the real estate market is strong. Yes, the market did take a hit which lowered the price of homes sold by about 10% on average. But, we are still seeing strong buyer demand and a market that has an extremely low inventory.
With the reopening of California over the next few days as just announced by Gov. Newsome, we can expect pent up demand to drive the market back to pre-pandemic levels around the Bay. Other parts of the United States will move more slowly as the new normal sets in.
The factor of greatest impact as we look forward across the nation will be the unemployment rate. To put the rate into perspective, the unemployment rate was 4.4% at the beginning of March and is now around 18.4% based on applications as the economic impact of SIP orders trickle through various industries. But, while California as a whole has led the nation in jobless claims while complying with SIP orders, the Bay Area still remains the lowest risk area in the state.
When we rebound, our local real estate market’s response will be dramatic as buyers and sellers flood the market.
Please look forward to our monthly market update to be released mid-month. We will cover individual market details in our monthly market update.