Editor's note: Terry Tremaine is the 2020 President of The MetroTex Association of Realtors is the largest Realtor association in North Texas and sixth-largest real estate association in the U.S.
COVID-19 has disrupted lives with health concerns, financial struggles, and restrictions on activities. Amidst this uncertainty, real estate professionals, buyers, sellers, landlords, tenants, and investors are trying to figure out the best course forward.
According to Dr. James Gaines, chief economist for the Real Estate Center at Texas A&M University, sales of existing homes in Texas fell in May to their lowest level since 2012.
"The month of May marked the housing market's deepest decline thus far during the ongoing COVID-19 pandemic," Gaines says in a release. "Texas' existing-home sales plummeted 32 percent year over year on top of a 22 percent slide in April."
Single-family homes performed better than condominiums and townhomes.
I recently listened to Dr. Gaines on a webinar regarding the coronavirus crisis and what it means to consumers. Here are a couple of takeaways I found very important.
Home sales on hold
Three things have a positive effect home sales — low interest rates, job growth, and inventory — and right now, only one of those is guaranteed.
Interest rates are anticipated to stay low for an indefinite period of time. It's been proven in the past that there is no better way to come out of a recession than "cheap money."
Job growth is a challenge. Gaines worries that there won't be enough jobs for those who were furloughed or laid off.
Inventory is down. Active listings in May 2020 were down across the board:
- 11.8 percent down in Dallas County
- 15.2 percent down in Tarrant County
- 22.3 percent down in Denton County
- 10.7 percent down in Rockwall County
Active listings need to rebound, but buyers and sellers are on pause.
The suburban market is going to have a lot more demand than we've seen in the last decade. The same is true for communities within 40 minutes of a major urban area.
As managers and business owners have gotten comfortable with remote work, there are more opportunities for people to live 40 minutes away and get their job done remotely.
We may have changes on the horizon, but as we have proven before, North Texas is resilient and in the end, we will come out of this with stronger communities and neighborhoods.
A version of this story appeared on Candy's Dirt.