Market Observations 6/3/20

Many states have eased a lot of COVID-19 restrictions as of the first of this month. Number of new cases in many areas have leveled or dropped off slightly, but regulations vary and social distancing should continue to be a priority if possible. In terms of the national market, in March, the Pending Homes Sales index of contracts signed on existing homes dove by 20.8%. When those contracts were counted as closings in April, a similar drop occurred in Existing Home Sales. We are waiting for data from May to see where we are now. With rates at historic lows still, there is a lot of refinance activity right now. This has managed to modestly improve purchase demand from the extremely low levels in Mid-April. The Mortgage Bankers Association has reported a 12% bump in purchase applications as coronavirus restrictions slowly continue to ease. This could indicate a sign of the upturn in the pandemic delated spring homebuying season. Some pundits are holding on to the strength of the US economy before the shutdown by citing the homeownership rate. In the first three months of 2020 it rose to 65.3%, the highest level in nearly seven years. Where that goes in the remainder of the year is anyone’s guess, but some remain more optimistic than others. Any speculation should not be taken seriously, as no one knows the correct answer and it is anyone’s guess. The only way to make any assessments is in arrears once the previous month’s data becomes available for evaluation. We are continuing to monitor all facets of both the rental and real estate market and will be available for Highlands Ranch property management consultation at any time.