Over the last month, more than 100 home listings in Plano were withdrawn, canceled or taken temporarily off the market—an unusually high number that roughly equals the previous two months combined, said David Long, the president of the Collin County Association of Realtors.
This housing market trend is not unique to Plano, Texas Realtors chair-elect Marvin Jolly said.
“I think sellers have made those decisions based on two things: No. 1, there are some sellers who are very, very health conscious,” Jolly said. “They may have a compromised immune system, and they don’t want anyone coming into their homes from a safety perspective. No. 2, it’s an economic concern, and they think that no one is going to buy houses. So they think they’re just going to wait and see.”
Home prices dropped slightly year over year, while the number of homes under contract rose, according to the Collin County real estate group.
But this further whittled away at the limited supply of homes on the market, where 28% fewer homes were available for sale in March than at the same point last year.
“We had been experiencing some of that even before the virus stay-in-place orders came down,” Long said of the limited inventory. “But I think it’s a culmination of factors. If you don’t need to sell, you might sit back and say, ‘I’m going to wait another month,’ or, ‘I’m going to wait another six weeks.’”
The region’s housing market had favored sellers for years before coronavirus restrictions upended the local economy. While some economists consider a housing market balanced when it has six months of inventory, Collin County had been hovering around three to four months of houses for sale, Long said.
In March, the supply of homes for sale fell to just over two months’ worth.
Normally a recession might be expected to help the market move back toward buyers, but that has not occurred this time because of the unique effects of the coronavirus restrictions, Jolly said.
“Some economists would say that we were two years overdue for a correction, and so coronavirus was potentially the trigger to provide some balance,” Jolly said. “The unexpected thing was, a bunch of sellers pulled their houses off the market, which kind of continues the seller’s market.”
Texas Realtors, the statewide group, is monitoring the economic conditions affecting the housing market and keeping a particularly close eye on the employment numbers. The sooner the jobless numbers stabilize and reverse, the better the outlook for the housing market as a whole, Jolly said.
