April 2020 Market Update

With Covid-19 bringing the economy to a halt, expectations were that the real estate market was going to get hammered, and understandably so. However, in comparison to the March survey, the percentage of Realtors stating Covid-19 is affecting their offers has decreased in April. Buyers are confident, but there are still hesitations in jumping in the market with both feet while Covid-19 continues to play a major factor in the economy.

New data shows that new listings have begun increasing around mid-April. This is after the initial jolt reaction of sellers removing their homes from the MLS in mid March. Inventory on the market is still low and has not totally recovered. Other factors playing into sellers’ decisions to retract from the market are the fact that Realtors are still not permitted to market the home in the same manner as we did pre-Covid-19. Or, if the home for sale is still occupied, the owners may not want anyone walking through their living space. Although Stage 2 of opening the economy has begun in California, the restrictions limiting Realtors from performing business as usual from stage 1 are still all in place. Realtors are still encouraged to perform showings virtually if possible.

Buyers are keeping the real estate market competitive in the Bay Area. As a result of low inventory and an increase of deal seeking buyers, listing prices are staying steady. In some cases they are even increasing. Alameda County boasts a 9.6% year-over-year increase in the median sales price of its homes, breaking the million-dollar mark. Remember, this is on the backdrop of 36.5 million Americans claiming unemployment. It is still too soon to declare that the increase in home value in Alameda County is contributed to tech professionals leaving the South Bay, Peninsula, or San Francisco to seek more affordable housing since many are no longer required to commute to the office, but this theory is certainly worth paying attention to.

With the current climate of Covid-19 and the introduction of new business practices, the Bay Area real estate market is still in limbo. Prior to Covid-19 the Bay Area housing market looked promising for 2020. When a vaccine is created you can certainly expect the housing market to come roaring back, flush with inventory and motivated buyers.