Housing inventory ready to move
Home sales are set to sizzle through summer.
Pending sales shot up in May, perhaps more than they fell in the first two months of t he coronavirus pandemic, according to just-released statistics.
That means people who had been side lined from the market started signing purchase contracts again.
Contracts signed in May will close in the next several weeks.
Realtor Brian Preston, who has tracked sales in Edmond and north Oklahoma City for years, could barely contain himself.
"WOW WOW WOW!!!" he wrote this week in his monthly Preston Report and blog fromwww.edmond4s ale. com ." We have just had the most pending contracts at one time for Edmond, 886. This coming during COVID- 1 9 , or right after opening up. That is 191 more than we had this time last year, a 27.4% increase. And 142 more than we had last month, which is an increase of 19%.
"So the pending contracts during the three months of COVID were down 20.9% the first month, down 6.9% the second month, and up 27.4% the third month compared to the same months last year. We can have a better rebound than what we had fall from this. Unless a second round comes about."
A lot is riding on that "unless." New COVID19 cases are blowing past previous records and hospitalizations are on the rise in the state.
Housing is ready for recovery from the coronavirus and its social and economic effects.
Statistically, there is a housing shortage in central Oklahoma, at least a dearth of houses listed for sale with Realtors. Houses sold directly by builders or homeowners are not included in the Realtors' numbers. That means sellers have the edge in negotiations.
It's not only in Edmond and north Oklahoma City. Across the metro area, even with the number of new listings up 8% to 2,329 in May, inventory still fell to just 1.8 months of supply, 2,936 listings, according to the Oklahoma City Metro Association of Realtors. In normal economic conditions, a six-month supply of houses for sale is considered a balanced market.
The shortage is especially apparent at the entry level.
“With low interest rates and down payment assistance available, many families are considering buying a home for the first time because they can get more house for their money,” said Mindy Turner of Advantage OK Real Estate, 408 S Mustang Road in Yukon. “Some are even finding house payments lower than their current apartment rent.”
Sellers are getting multiple offers. Turner said buyers have to act fast for houses under $150,000.
Taylor Pettyjohn did. She said she jumped on her dream home the day it hit the market.
“We're currently in a one-bedroom apartment, with two dogs and a baby on the way,” Pettyjohn said. “We knew exactly what type of home we wanted for our growing family, so we made an offer the same day we saw the home.”
Unless the coronavirus creates fresh disruption in society and the economy, bottled-up demand could continue to erupt. Across the metro area, pending sales in May shot up 25.5% to 2,371, and closings plummeted 24.3% to 1,541, the Realtors reported.
Preston' s report and blog provides a snapshot of the market, and the importance of timely reporting of statistics during the pandemic.
"Closed sales are lagging behind the pendings of course," said Preston, broker-owner of of RE/ MAX at Home, 3224 S Broadway Ave., No. 225, in Edmond. "May was not a good closing month, with 397 closed transactions as of now for May. compared to 512 last year. I say 'as of now' because I was trying to get this out early this month and more closings were added between Wednesday last week and Friday, and even more between Friday and Wednesday of this week, making me run the numbers and redo the report three times to make it as accurate as possible.
"So we may still have some more sales waiting to be entered. But May was down 22.5% from last year. So the closings for the same three months of COVID was up 9.7% the first month, down 6.4% the second month and down 22.5% the third month. We should see good numbers next month with the number of pending contracts we are at now unless t hey have 45- plus- day closings."
Preston's numbers also suggest the resilience of the market.
"We started off ahead of last year's record-setting year for the first three months of the year, and even with the downturn of the last couple of months, we are only down 2.5% in year-to-date sales through May — and that is off a record-setting year."