03/19/2020
CoronaVirus Affect on Real Estate
As I write this on Thursday, March 19, 2020, I reflect on how different our lives are from just a couple of weeks ago. The Coronavirus appeared to many of us to be a temporary inconvenience. Now, it is likely to be life changing for most if not all of us, a signature moment in our nation’s history, not unlike 9/11.
A few weeks ago, the stock market was at an all time high, just under 30,000. Today it is under 20,000, a 35% drop in just 2 weeks. A few weeks ago, Livermore properties were in such demand that open houses were packed and most received multiple offers the first week on the market. Now…well, there have been a few that have gone pending, but even these received 1 or 2 offers, likely at or below asking price; open houses and showings have come to a standstill, even with very low interest rates.
So what’s going to happen in the weeks and months ahead? I have no idea how long this will last, but here are a few observations:
1. Prior to the Coronavirus, buyers far outnumbered sellers in the Tri Valley, and in fact for the entire country. When we get on the path to recovery, this will be the case again
2. Unlike 2008, most current homeowners have significant equity in their homes. What this means is, the market will not be infused with a large amount of foreclosed homes to drive home prices down
3. It’s an election year. Real estate and related industries play a significant role in our GDP. Regardless who’s in office, during election years the administration almost always institutes policies like rate cuts to make real estate more attractive to buyers. This has already started happening, and it will continue throughout 2020.
My suggestion for folks who planned to list their home this spring (assuming you don’t have to sell asap): go ahead and get your home ready for sale, even including photos, so at a moment’s notice your realtor can put it on the mls. I think that when things calm down, the market will be flooded with new listings – you want your home on the market and hopefully even in contract before that happens.
I was here selling houses during the 2008 financial meltdown, and I’ll be here selling houses after the Coronavirus is history. If you have any questions, please contact me – I can be a valuable resource.
