A report by Realtor.com predicts that home sales will rebound in July, August, and September as buyers return to the market, but will turn negative again in the final months of the year due to another forecasted spike in coronavirus cases.
Of the buyers and sellers, the report predicts that millennials will purchase 50% of homes sold in 2020 while baby boomers will likely wait to list properties until the market normalizes.
Business Insider talked to Realtor.com’s senior economist about how the market will look in 2020.
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The US housing market had a strong start to 2020.
In the last quarter of 2019, million-dollar sales were up 11%, and housing prices overall were up. On an annual basis, 2019 saw the most first-time homebuyers since 1993, according to Genworth Mortgage Insurance. Then in January, new home sales and pending homes sales both jumped, and inventory was at its lowest level since 2012.
However, the coronavirus outbreak forced the market to reverse its course.
In the last week of March, new listings were down 36.9% from the same time last year. For the week ending April 17, that decline had spiked to nearly 50%, according to Redfin, while Realtor.com reported that for the week ending May 2, new listings were down 39% from the same time last year.
Two generations that were all queued up to make a big splash in the housing market this year were the millenials, mostly first-time homebuyers, and the baby boomers, who are retiring and looking to move. But how will the pandemic change those trends?
Read on to see what Realtor.com predicted for the generational divide in the 2020 housing market and how its senior economist told Business Insider that it might play out.
Most of the housing market was brought to a halt in mid-March
Since the outbreak worsened, home sales have seen a dip. An April report by Seattle brokerage Redfin said nationwide home sales dropped 9.1% from February to March on a seasonally adjusted basis — marking the steepest decline seen by Redfin since it started recording data eight years ago. And Realtor.com has predicted that home sales will see a 15% year-over-year drop by the end of 2020.
Realtor.com expects buyer interest and home sales to pick up in July, August, and September as coronavirus fears dwindle. However, as fears of a second wave are predicted to loom over the market in the last few months of the year, buyers are expected to draw back again.
It’s not just buyers who are expected to show behavioral shifts, sellers may also have to adjust to properties that draw fewer offers and have longer listing times.
“Many sellers, who will also be subsequent buyers, will find the slower pace of sales and longer time on market have made timing a sale and a corresponding home purchase increasingly difficult compared to prior …read more
Source:: Business Insider