This morning I felt the need to update my “Market” template. I have been adding some commentary about COVID-19 but I thought it best to relook and all my statements and see if they were still relevant.
It seems like every other day there is a new webinar updating or explaining the COVID-19 Appraisal process. I have participated in many but not all. It is clear that Fannie and Freddie both expect appraisal reports to clearly and accurately report the current market, and the expected impact on the subjects specific market in the near future.
I am seeing more active inventory, more canceled contracts, more withdrawn listings, more price reductions in most of the markets I work, all indications of a softening market. As I talk to homeowners there is less confidence in the future. I have not seen the typical spring “bump” we usually get. So how do I separate these impression and anecdotal conversions from the facts, and then report them to my clients?
I know that I am spending more time analyzing the each specific market and trying to use and rely on the most recent sales (30-45 days) and lastly sticking to my opinions when challenged.
So, how will COVID-19 impact the Utah market. Those of you that attended our March UAA spring symposium were introduced to several sites and tools to help report the up-to-date market accurately. Here is some published insights by Jim Wood.
POTENTIAL HOUSING IMPACTS By: Jim Wood, Ivory-Boyer Senior Fellow
The global spread of COVID-19 has pushed mortgage rates to the lowest level on record, 3% or less. Through refinancing or home purchase, these low rates offer an unprecedented opportunity for homeowners and homebuyers to capture sizeable long-term savings on their housing costs. The best strategy for current owners would be refinance with a 15-year low interest mortgage. In this case, the term of the mortgage is shortened while taking advantage of exceptionally low rates. The economic uncertainty will very likely dampen housing price increases in the short-term. Slower price increases combined with the record low interest rates enhances the economic environment and potential savings for the home buyer. Low mortgage rates will cushion the homebuilding industry from the worst impacts of the global spread of COVID-19.
Here is a report (link) from the Kem C Gardner Policy Institute at the University of Utah.
https://gardner.utah.edu/wp-content/…/BusinessCycleTable.pdf
Also a great web-page to bookmark for the latest economic, demographic and public policy info. This is more of the economic impact and not the number of confirmed cases.
https://gardner.utah.edu/covid-19/
Other links to relevant reports.
https://gardner.utah.edu/wp-cont…/uploads/COVID-19-Brief.pdf
I am not really sure if this will help but thought I would pass along.
Be safe and wash your hands….. and don’t touch your face.