New home sales have taken a dive to historic lows in March, as lockdown measures and stay-at-home orders have been put in place across the US. However, the problem does not stop there: now, according to recent data released by the National Association of Realtors, the pending home sales category has also suffered much the same downward-spiraling fate.
Prior to the pandemic, the housing market was already in the midst of a property shortage. Now, amid the coronavirus fiasco many potential sellers have decided to de-list their property and leave the housing market altogether. This has led to a 20.8% drop in pending home sales – the largest drop since 2011.
Property sellers and potential buyers have instead opted to stay at home and avoid unnecessary interactions, leaving the housing market desolate and at a standstill. Some have resorted to virtual property showings and online mortgage applications, but that most likely is not going to be enough to get the market back to equilibrium.
Information for this briefing was found via CNBC, MarketWatch, and Bloomberg. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.