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    How Is COVID-19 Affecting the Housing Market?

    COVID-19 is transforming what was once considered “normal” life. For example, all residents of Fulton County are ordered to stay in their homes with few exceptions. Anyone who violates this order will be charged with a misdemeanor and could face fines as large as $1,000 or up to 12 months in jail per each offense. 

    The U.S. and local housing markets are no strangers to change due to the pandemic. Here are several ways the coronavirus pandemic is affecting the housing market. 

    Residential Housing Sales Are Slowing Down

    The first half of March was strong for house sales in Georgia. Throughout all of March 2020, there was an increase in total residential units sold from February 2020. The total residential units sold in March 2020 was 7,811, while 6,355 units were sold in February 2020. This is an 18.64% difference. 

    Unfortunately, by the second half of the month, significant slowing down due to the pandemic was evident and has continued. However, according to Realtor.com, “To the housing market’s advantage, the same Covid-triggered pause in activity creates a backlog of both demand and supply, which can help fuel the initial recovery.”

    Inventory is Limited

    While the spring months are typically a hot time in the real estate market, it appears that sellers are more hesitant to place their homes for sale. The number of listings has drastically decreased, a strong indication that the pandemic is affecting real estate activity. 

    When comparing the number of listings in March 2020 to March 2019, you will notice a significant difference. In March 2020, there were 17,802 active listings throughout Georgia. In March 2019, there were 19,361 active listings throughout the state. This is an 8.76% decrease from 2019 to 2020. 

    Luckily, there is a boom in new construction. In Alpharetta and the surrounding communities, there are 225 new construction homes available with 56 currently under construction and 40 still to be built. 

    New Open House Rules

    Open houses are just one obstacle that buyers and sellers are currently facing. Open houses are now much different than they were several months ago. Today, due to the coronavirus pandemic, there is no touching, sitting, etc., in the home. You should not be opening doors, cupboards, closets, etc. This is making it challenging for buyers to truly experience a property and many of its features. For sellers, it limits what the buyers see.

    Many real estate agents are offering virtual tours of the property, which is a safer option for both buyers, sellers, and real estate agents. These virtual tours allow buyers to fully browse the property without setting foot inside it. You can get 360-degree views of the property and experience the full layout of the home. This is a terrific opportunity to safely see a home and to determine if you want to learn more about the property and take the next step in the buying process. 

    Mortgage Applications Drastically Slow Down

    Another sign of a slowing housing market is the number of mortgage applications being submitted to lenders. In the United States, mortgage applications to purchase a home have dropped for five consecutive weeks. There are 35% fewer mortgage applications than one year ago. 

    However, for individuals who are purchasing a home this spring, now is an excellent time. Interest rates have reached a historic low. For example, in the middle of April, a 30-year fixed mortgage rate averaged 3.31%. In April 2019, mortgage rates averaged 4.17%. The previous mortgage rate low was in November 2012. The average rate at this time was 3.31%.

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