March and April are typically real estate's busiest months, when most of the inventory comes on line and most of the houses are bought and sold. But this year is dramatically different.
As social distancing measures have been ordered, real estate agents have increasingly changed their behavior. Some have canceled open houses, some have had sellers pull their listings off the market, and some have stopped touring with clients altogether.
It's a dramatic slowdown during what was expected to be a very competitive spring, coupled with the prospect of a looming recession.
So, what does all this mean for home values?
First of all, says Windermere's chief economist Matthew Gardner, this is not 2008. During the 2008 recession, home values dropped 30 or 40 percent, and Gardner says that's not our situation at all. This is a health crisis, not a housing crisis.
While he has seen pullbacks in sellers listing their homes, Gardner says that's largely due to concerns about contagion. And while he has seen some reduction in buyer demand, for buyers who intend to buy this spring or summer, the historically low mortgage rates currently available have created an incentive for buyers to follow through with their purchase.
Daryl Fairweather, chief economist at Seattle-based real estate brokerage Redfin, says that there are ways around seeing real estate in person. She mentions 3D home tours, which are available on the Redfin website. Many papers can be signed remotely.
For sellers, Fairweather says that if you are committed to listing your house, make sure it's priced fairly so it doesn't linger on the market.
For buyers, Fairweather says, now could be a good time to get into a home without having to navigate Seattle's famously competitive market.
"If you've decided to buy and you're committed to that decision, now could be a really good time to do so," she said.
Things could change even more dramatically if a shelter-in-place order is enacted in the coming weeks or months. That would mean that nearly all buying and selling activity will come to a halt. It would make for a tough spring and summer for buyers and sellers, as well as those who depend on the market for their livelihood — including real estate agents, stagers, inspectors, appraisers, title agents, real estate attorneys, and home repair contractors.
Still, both Gardner and Fairweather believe that the fundamentals of the Seattle real estate market are strong. Seattle is still a desirable place to live, and there are fewer houses available than people who want to buy them.
That means, when the health crisis is resolved, both expect the market will have a dramatic recovery. The pent-up demand could create a sharp uptick in houses available for sale and buyers who want them. As for when that could happen, Gardner estimates the current crisis could persist through the fall.
In the meantime, Gardner and Fairweather advise a measured approach to real estate. A house is a home, and they say if your finances are sound and you’re buying for the long term, there’s no reason to feel frozen in place by the current uncertainty.
“It’s better,” Fairweather said, “to buy the right house at the wrong time than the wrong house at the right time.”