Housing prices holding firm at this stage
Roseville, CA- Since the COVID-19 pandemic began, the number of buyers looking to purchase their first home is increasing, while investor activity is declining. First-time buyers do not have a home to sell an and seem to be placing more value on homeownership during the pandemic.
According to the National Association of realtors, the number of first-time buyers accounted for 36 percent in April. This is an increase 4 percent from the same month last year.
With fewer investors in the market, cash sales dropped to 15 percent of existing home sales in April. This is a drop from 20 percent a year ago. It also means first-time buyers are facing less competition from investors.
Clearly, low interest rates for mortgage are attracting first-time buyers. With the current low interest rates mortgage payments are down from the first quarter of this year.
Decline of investors
The decline of investors in the housing market may be because they believe the financial risk associated with renters, due to COVID-19, is increasing. During the recession there were a great number of foreclosures and downward pressure on prices. What we are seeing, so far, during the pandemic the prices are holding firm and because there are more buyers than sellers, there is upward pressure on prices.
Julie Jalone – Magnum One Realty
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