Buyers Pause During COVID-19 Surge, Election | Realtor Magazine
Home shopping was down last week as the nation focused its attention on a heated presidential election and a surging number of coronavirus cases across the country, realtor.com® reports in its Weekly Housing Report.
Mortgage demand from home buyers dropped to the lowest level in six months, the Mortgage Bankers Association reported on Wednesday. Its weekly mortgage index showed that loan applications to buy a home dropped 3% last week. Applications are still 16% higher than a year ago, however. But the latest dip in applications marked the sixth time in seven weeks that the index has seen a decrease, and last week’s marked its lowest level since May 2020, MBA reports.
“Between the presidential election and a new wave of coronavirus cases, buyers and sellers had a lot of reasons to pause last week,” says Danielle Hale, realtor.com®’s chief economist. “The big question is whether both buyers and sellers will jump back into the market after last week’s break. With mortgage rates expected to rise on news of a likely vaccine, buyers may have reason to jump back in and find a home sooner rather than later, but sellers may be more inclined to stay on hold. Thus, even as overall activity slows, we may very well see continued price growth and quick sales.”
A limited number of homes for sale likely continues to constrain buyers too. Newly listed properties are down by double digits compared to a year ago. “New listings are a crucial ingredient for home sales, and they will need to make a strong comeback for housing activity to continue,” realtor.com® notes in its report.
Meanwhile, listing prices continue to see double-digit growth, up 12.9% over last year, according to realtor.com® data. Homes that are on the market are selling fast, with the number of days on the market nearly two weeks fewer than last year. If homes continue to sell quickly, “it is a good indication that buyers have no intention of taking the holidays off this year, but continued steadiness in the year-over-year difference would mean we’re seeing at least some of the usual seasonal pause in housing activity,” realtor.com® notes in its report.