The economy is shrinking, businesses are closing and jobs are disappearing due to the coronavirus pandemic. But in the housing market, prices keep climbing higher.
Home prices plunged during the last recession after the 2007 housing crash caused millions of families to lose their homes, but that hasn’t been the case this time. The median home price nationwide rose 8% year-over-year to $280,600 in March, according to the National Association of Realtors. In the same period, in Jackson County, the median home price rose 11.5% to $310,000. While buyer demand has softened during the pandemic, the number of homes sold has fallen by over 30% in Jackson County; but the supply of homes on the market is contracting even faster. Demand is outstripping supply, causing prices to rise. Homes priced under $350,000 are often seeing multiple offers and selling in a few days. Higher-end homes, over $600,000, are still waiting for more out-of-state buyers to arrive. Here in Jacksonville, it’s another story. Even though active listings are down by 27%, we have seen the number of homes sold increase by 84% year-to-date.
For the first time in my career, I’m seeing out-of-state buyers purchasing homes without seeing the home in person. They are making offers on homes after viewing the listing online and viewing a walk-through video. In one case, a retiring couple had their brother, who lives in Jacksonville, walk through a home and make a final decision for them. Many others are calling to inquire on homes but waiting for stay-at-home orders to ease before deciding whether to make the trip to buy. Once the states lift their stay-at-home orders, we will see how home sales are affected. It’s hard to say what the world will look like post-pandemic, but it will change many people’s’ behavior.
On one hand, the cancellation of the Oregon Shakespeare Festival and the Britt Festival will mean the loss of thousands of monthly tourists who often decide at the end of their vacation to move to our area. But, on the other hand, thousands of families and retirees will most likely decide to move out of crowed metropolitan areas in favor of smaller, safer communities like ours. Southern Oregon lacks job opportunities, but many employers may be more open to their employees working from home after favorable experiences during the pandemic.
Bottom line: the housing market has been under-supplied for years and during the pandemic it has gotten worse. We are currently facing lots of demand for housing which will increase as the pandemic subsides. Unless we see a drastic increase in the number of homes that come on the market for sale, we will certainly see home prices continue to rise throughout 2020.