Market Watch Report 1st QTR 2020

There is speculation in the news as to how the COVID-19 virus will impact the U.S. Housing market.  I think no one knows the answer to this question yet.  No doubt, real estate will be affected but to what degree is still unknown.  Because all real estate markets are local, individual markets across the country will be impacted differently depending on how hard hit the virus was in their area.

When some states implemented the stay-at-home-orders in their state, real estate was not considered an essential business so all services related to real estate had to close down.  However, North Carolina included real estate in the essential business category.  So, real estate activities have been continuing within our state.

However, real estate brokerages and agents are adapting to the situation.  New procedures have been put into place to protect everyone during this time.  For example, our showing service in the Triad Area, SHOWTIME, is implementing virtual showings for prospective buyers.  Open Houses are also going virtual.

Single Family Homes Statistics

At the end of the 1^st quarter 2020, there are 482 Single-Family Homes under contract.  During the 1^st QTR 2020, 617 Single-Family Home new listings came on the market.  This was a 10.6% increase from the 1^st quarter in 2019 when there were 558 new listings.

At the end of the 1^st quarter 2020, the number of Single-Family Homes for Sale is 432 properties.  This was a 9.6% decrease from the 1^st quarter in 2019 when there were 478.

During the 1^st QTR 2020, 444 Single-Family homes closed, which is a 16.8% increase from the same time period in 2019.  Sellers are receiving 97.3% of their list price.

Median Sales Price for Single-Family homes in the 1^st QTR 2020 is $ 170,000, which is a 9% increase from the same time period last year.

Analysis of the absorption rates indicates an inventory of 2.6 months for Single-Family homes.  Most properties are going under contract within 59 days.

At the end of 2019, I reported that Davidson County had a 3 months supply of inventory for Single-Family Homes, which means we are in a Seller’s Market.  The entire year was at a 3 to 4 month inventory range.   In real estate, we consider 6 months of inventory to be a Balanced Market.

The chart shows stats on the supply of homes for a 3 year period in Davidson County and the cities of Lexington, Thomasville, and Denton.

This chart displays Days on Market for a 3 year period in Davidson County and the cities of Lexington, Thomasville, and Denton.

As you can see in the chart below, the Median Sale Price in Davidson County has been steadily increasing here since 2015. At the end of March 2015, the Median Sales Price was $134,500. The Median Sales Price in March 2020 is $183,900. That is an increase in five years of 34.7%

Townhome Statistics

At the end of the 1^st quarter 2020, there are 43 Townhome Listings pending.  During the 1^st QTR 2020, 55 New Townhome Listings came on the market.  This was a 12.2% increase from the 1^st quarter in 2019 when there were 49 new listings.

At the end of the 1^st quarter 2020, inventory is 27 Townhomes for sale, which was a 15.6% decrease from the 1^st quarter in 2019 when there were 32.

During the 1^st QTR 2020, 23 Townhome Listings closed, which is a 41% decrease from the 1^st QTR in 2019 when 39 townhomes closed.   Sellers are receiving 99.1% of their list price.

Median Sales Price for Townhomes in the 1^st QTR 2020 is $ 195,000, which is an 8.4% increase from the same time period last year.

Analysis of the absorption rates indicates an inventory of 2 months for Townhome Listings.  Most properties are going under contract within 35 days.

• Buying now with a low interest rate can be a good thing if you feel secure in your employment and have your finances in order.
• The decision to purchase a home is a basic need and is usually influenced by entering a new stage in one’s life like getting married, job relocation, expanding family, retiring and downsizing.
• Inventory levels will still be challenging for buyers in all price ranges but particularly for homes under 200K.  There will probably still be multiple offer situations in 2020.
• The interest rate you pay the bank in your mortgage payment is an important factor in buying a home.  The lower the interest rate the lower financing costs you pay over the life of the loan.
• Another benefit to lower mortgage interest rates is the affordability factor.  The lower the rate, the more home you can afford to purchase.
• Ask yourself how long you plan to live in your new home.   If that timeline is less than five years, look for a property where you can add value during your ownership.
• Know your housing budget and stick to it.  You do not want to be house poor.
• Look for a neighborhood that meets your present needs.  In particular, pay attention to the school district.  Homes in a good school district hold their value better in a declining market and rise faster in a seller’s market.

• With inventory levels this low, there is less competition now in the marketplace.
• Since the great recession ended, home prices have been appreciating.  The Median Sales Price for Single-Family Homes was $169,000 in 2019.  This was a 5% increase from 2018 when the Median Sales Price was $161,000.  In looking back five years, there was a 26.8% increase in the Median Sales Price from 2015 when it was $133,250.
• Talk to your agent about the new environment and procedures for showing your home and accepting offers.
• Buying and selling a home is a complicated transaction, and worrying about two real estate transactions at one time can be a daunting task.  Over the past two years, many sellers bought their next property before they put their present home on the market.

You might also like:

1st QTR 2019 Market Watch Report

2nd QTR 2019 Market Watch Report

3rd QTR 2019 Market Watch Report

4th QTR 2019 Market Watch Report

We will have to wait and see how Covid-19 influences the Davidson County Real Estate Market.  Below this summary are two charts displaying the number of new listings and closings in April 2020 thru April 23rd.

Our supply of homes was low before the outbreak of the virus.  This shortage will continue and active buyers in the market will have to act quickly if a home comes on the market that is a good fit for their needs.

Because of the present inventory shortage, it might be an excellent time for sellers to list their property because there will be less competition.

Transactions might take longer to close because of scheduling difficulties with service providers.