April Market Report 2020
COVID-19 April Market Report
How's the market?
There are two questions on everyone's mind:
1. How's the market?
2. When is this going to end?
In this video, I set out to answer both of these. And while every situation is different, the reality is that we are in a general slow down with fewer homes on the market, and even fewer buyers buying those homes. The Los Angeles housing market is not like the rest of the country. Let me run you through what you won't see on national television.
Are people still selling?
The simple answer is yes, people are still buying and selling properties. While homes are still being sold, there are 28% fewer homes on the market here in Los Angeles. That's about the same as the rest of the country. This is common in times of uncertainty. Look at radical events like 9/11, WWII, and the housing crash of 2008. When the future is uncertain, it is in the human psyche to pull back from making large decisions. Clearly, buying, selling, or investing in real estate can be high on this list for most Americans.
LA is different than the rest of the US in that we're now a buyer's market. (See Below)
Did you say "buyers market?"
That is correct. The difference between a buyers market and a sellers market is how long it would take to sell all of the homes currently listed for sale. This can differ all around the country. Here in Los Angeles, the neutral market threshold is about 4.5 months of inventory. That means, that if no new listings came on the market, it would take about 4.5 months to sell every homes that is listed. Before the economic shock from Covid-19 put everything on pause, we were seeing about 3.5 months of inventory. That's a moderate sellers market.
With 7 months of inventory, we are now in a buyers market.
Naturally, prices have shifted. (See Below)
That's right, LA is on sale!
LA home prices have adjusted down 10% from February to March. This is counter seasonal. Don't get caught up here. To put that into perspective, home prices were up 6% from February 2019 to February 2020, and are now down 2% from March 2019 to March 2020. This is common in a buyers market. Instead of buyers competing for sellers to pick them, this is the kind of market where sellers need to compete for buyers to pick their home. Naturally, price, condition and location are the three things that every buyer looks at. If you can't change the location of your home, you're either going to have to improve the condition or decrease the price.
If you're wondering which move is right for you we should talk
Breaking Bad Minion House
If you're anything like me, then you've probably seen more of your neighborhood than ever before. Daily walks have become the routine for us. Being in real estate, I am always looking at homes. This home has my favorite decoration.
Until next time my friends, take care, stay safe, and social distance like your life depends on it.