May 2020 Crisis Update. Market activity begins to tick up after severe shelter-in-place plunge. Median home sales prices are up. Interest rates hit new low.
Shelter-in-place caused steep drops in activity across the board in what is typically the busiest selling season of the year. However, though still far below normal levels, activity has been picking up since bottoming out in late March/early April, and will presumably continue to do so with the easing of both shelter-in-place and property-showing rules.
So far, home prices have increased, but a fair proportion of the sales behind April median sales prices still reflects offers accepted prior to shelter in place.
Interest rates hit a new historic low in the last week of April.
Week by Week Supply & Demand Trends
The only way to clearly perceive the recent changes in the market – sudden plunge and the beginning of recovery – is by looking at WEEKLY trends in buyer and seller activity. These are illustrated in this first chart below.
Year-over-Year Changes in Median Home Sales Prices
Generally speaking, the first months of 2020 have been characterized by year-over-year increases – often considerable – in median home sales prices across the Bay Area.
Longer-Term Trends in Median Home Prices
– 12-Month Rolling Illustration
Year-over-Year Monthly Activity Comparisons
The next series of charts reflects the dramatic changes in market dynamics by MONTH as compared to spring 2019. These don’t illustrate the uptick in activity in the most recent weeks.
Year-over-Year Changes in Luxury Home Markets
Mortgage Interest Rates
At the end of April mortgage interest rates hit a new historic low.
We are not going to review the economic news already extensively covered in the media, except for this stark illustration of the unparalleled rise in unemployment. How quickly this horrifying trend can be reversed will probably be the single largest factor behind an economic recovery.