When the COVID-19 pandemic hit, many potential buyers decided to put their home search on hold. But it looks like buyers are getting back to searching for homes online.
Google and Zillow Data Analyzed
According to recent analysis from LendingTree, which analyzed Google search data, search interest value for the term “homes for sale,” which measures the popularity of a search term on a scale of 1 to 100, jumped from a low of 56 when the pandemic hit to 86 by the end of April—an increase of 54 percent!
With stay-at-home orders starting to gradually lift throughout parts of the country, data indicates homebuyers are jumping back into the market. After many families put their plans on hold due to the COVID-19 pandemic, what we once called the busy spring real estate season is shifting into the summer. In 2020, summer is the new spring for real estate.
Joel Kan, Economist at The Mortgage Bankers Association (MBA) notes:
“Applications for home purchases continue to recover from April’s sizable drop and have now increased for five consecutive weeks…Government purchase applications, which include FHA, VA, and USDA loans, are now 5 percent higher than a year ago, which is an encouraging turnaround after the weakness seen over the past two months.”
Additionally, according to Google Trends, which scores search terms online, searches for real estate increased from 68 points the week of March 15th to 92 points last week. As we can see, more potential homebuyers are looking for homes virtually.
Opportunites For Buyers
Another reason buyers are coming back to the market, even with forced unemployment and stay-at-home orders, is historically low mortgage rates. Sam Khater, Chief Economist at Freddie Mac indicates:
“For the fourth consecutive week, the 30-year fixed-rate mortgage has been below 3.30 percent, giving potential buyers a good reason to continue shopping even amid the pandemic…As states reopen, we’re seeing purchase demand improve remarkably fast, now essentially flat relative to a year ago.”
With mortgage rates at such low levels and states gradually beginning to reopen, there’s more incentive than ever to buy a home this summer.
Opportunities For Sellers
So, what does this mean for sellers? An increase in searches for the term “homes for sale” is a good indicator that buyer interest is starting to pick up again—so if you’re thinking about selling your home, consider that good news.
According to last week’s Weekly Economic and Housing Market Update from realtor.com:
“Weekly Housing Inventory showed continued tightening. New Listings declined 28% compared with a year ago, as sellers grappled with uncertainty and hesitated bringing homes to market. Total Listings dropped 20% YoY, a faster rate than in prior weeks, leaving very few homes available for sale. As Time on Market was 15 days slower YoY, asking prices moved up 1.5% YoY.”
Summary
If you’re thinking of selling your house this summer, now may be your best opportunity. With so few homes on the market for buyers to purchase, this season may be the time for your house to stand out from the crowd.
Finding a home to buy, however, is still a challenge, as this spring sellers removed many listings from the market, and you may have some stiff competition for houses.
Though more people are now putting their houses up for sale this month as compared to last month, current inventory is still well below last year’s level.