How COVID-19 is Affecting the Phoenix Real Estate Market By Jenn Jenkins
So Jenn, how is the real estate market? I was thinking of selling, but now I am not sure.
My response to everyone has been, time is the only thing that will tell the impact this will have, but here is what I can tell you for the short term. As of right now, prices have not been impacted. History shows us that for prices to be impacted, which does not happen overnight, that would take an upwards of 6 months in shifts occurring.
One very important piece of information for people to remember is that this is not like 2007/2008 – which was financially driven. Our shifts are crisis-driven right now and we expect that when the crisis clears, the housing market will bounce right back.
The increase in supply that you will see are driven by a number of factors.
The short term/vacation (AirBNB) rental operators have seen their business evaporate overnight. They are realizing that they now have an expensive asset to own and run, with little to no income to support it. They are placing these properties up for sale or long-term rental, or both. The data is consistent with this statement as the most common listing being added to the MLS today is either a condo or a townhome.
The iBuyer. The iBuyers have stopped purchasing homes for the indefinite future. These companies’ investors are locked to the stock market; therefore, they are holding their money at this time. Therefore, sellers are now placing these listings with Realtors™️ like myself, which will temporarily increase the number of homes on the MLS.
With the stock market shifting daily, and sometimes at crazy rates, cash is in short supply and some owners need to turn fixed assets into liquid assets.
Many of our winter visitors have returned home due to this pandemic.
A decrease in buyer activity due to possible job security concerns and quarantine protocols.
A few more listings have been taken temporarily off the market due to concerns about having buyers walk through the property.
We will have to give ourselves a little bit of time before the data can really help us predict anything, we do know historically what happens in a time of recession. Inventory is still extremely low and buyers are still very active. Understanding the data and following the market daily is key right now.
If you have been thinking of buying or selling, let’s talk about your specific situation.
We are all having to shift at this time, but I firmly believe we will all be okay in the end.