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Guest column by real estate broker Beth Moran–
Citrus Heights has not escaped the impact of the coronavirus pandemic as we seem to be on par with the rest of the five-county region, with slowing sales.
The lack of inventory has been further exacerbated by the shelter-in-place order, and homeowners delaying putting their homes on the market.
There are numerous factors impacting sales: the inability to tour homes, which obviously impacts sales, and the number of homes taken off the market or cancelled. Additionally, lenders are scrambling to figure out how to conduct business, given the forbearance granted by the federal government.
Here’s a quick overview of what is happening in the local housing market in Citrus Heights:
On March 16, Gov. Gavin Newsom put forth a statewide mandate to allow for delayed rents, alleviating stress for Californians who have lost their ability to work. In Citrus Heights, nearly half the population is renting so we would expect to see little movement in vacancies (not including those living in senior communities who technically rent).
This will impact the seasonal shift from renter to homeowner as people use savings to make up for lost income instead of purchasing a home. Delayed rents on owners of large multi-family units, as well as the mom-and-pop investors, is yet to be seen.
Depending on the location of the landlord, the overall impact might not be felt locally, but it stands to reason that if you are dependent on rental income, your liquidity will be impacted.
In Citrus Heights, the number of homes listed for sale (286) and sold (196) since the beginning of the year shows that year-over-year not much has changed — that is, until you look at the number of homes that have been placed on hold in the multiple listing service (MLS).
The “hold” status allows for agents to take a home off the market until further notice without impacting the days on market (DOM). This is significant, particularly when buyers see homes on the market the first time they shop.
If a home shows that it’s been listed for a few weeks, people tend to wonder: why it hasn’t sold quickly? In other words, what’s wrong with the house?
Once a house is placed in hold it disappears from the MLS, but more importantly it keeps its original days-on-market once it goes back on the market for sale.
The number of holds started to climb on March 11, and currently stands at 21 homes, just in Citrus Heights. There have also been 15 cancellations, which all together translates to about 12.5% of the Citrus Heights market.
According to my colleague, Ryan Lundquist, a real estate appraiser who is watching this market very closely, the Sacramento region is still managing to limp along. His blog shows 996 pending sales since March 12, which is down 51% from the previous two weeks.
In speaking with other real estate agents, I found that some cancellations are due to job loss, but others from the threat of a work slowdown. Showing properties to clients has also become a challenge, and even showing vacant homes has been prohibited by the California Association of Realtors as a violation of the governor’s order.
New home builders have also scrambled this past couple of weeks to get all their homes online, so touring is available via the internet. I believe most require appointments to tour new subdivisions in person, which doesn’t make sense to me given the mandate to isolate.
The lenders are probably the most impacted at this time, and are wondering how all this will shake out in the end. The loans available have seen a jump in interest rates, and people with low credit scores are going to be challenged.
We can’t predict how this will turn out and we will have to wait and see what the market does without making assumptions, although I can predict one thing for the near future: you will be spending more time in your home.
Beth Moran is a real estate broker living in Citrus Heights. She can be reached at Beth@SacAgent.com
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