How COVID-19 could affect pending home sales in NYC

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April 24, 2020
what happened to pending home sales

The Coronavirus pandemic has changed our life in NYC, but how has it also affected pending home sales and the real estate market thus far?

What are pending home sales?

A pending sale status means that the seller has accepted an offer form a buyer, but the deal hasn’t been fully closed yet. This means that while the house is “sold,” it isn’t official until the deed and title gets passed onto the buyer. However, the seller isn’t able to consider other offers until the buyer cancels their sale first or for other reasons, the sale falls through.

According to pending homes data, contracts signed in February were up by 2.4% compared to January and sales were up 9.4% compared to February 2019. This means that before the Coronavirus pandemic, the real estate market in NYC and all of the United States was in good condition, hitting its highest pace in three years. 

What does it mean when a house is pending sale?
246 83 Street Bay Ridge, New York

The real estate market amid COVID-19

Despite the real estate market being in great shape prior to Coronavirus, the pandemic has hit the market in various ways. Due to the impact of COVID-19, not only will the pending contracts be potentially affected, but also homes for sale in NYC, buyer demand, and possibly housing prices. For example, we have already seen a large decrease in rental prices in New York City.

According to the Mortgage Bankers Association, the number of mortgage applications for home buyers dropped 35% in New York during the last week of March. This was the biggest drop since 2009. However, Lawrence Yun, National Association of Realtors’s chief economist, says “Numbers in the coming weeks will show just how hard the housing market was hit, but I am optimistic that the upcoming stimulus package will lessen the economic damage and we may get a V-shaped robust recovery later in the year.” (CNBC). Yun also estimated that for pending home sales, “10% cancellation at most. New York, New Jersey, Pennsylvania and California could have a higher figure” (CNBC).

What would make your next home perfect?
Find it now on Localize ✨

Even before the pandemic, the real estate market was suffering from low inventory despite high demand for housing. This is mainly due to low interest rates encouraging people to purchase housing. However, due to the Coronavirus pandemic, many sellers are pulling their listing properties which has led to even a smaller supply pool for home buyers during this time. 

According to CoreLogic, “During the last recession, housing prices nationally fell by an average of 19.7 percent” (LIBN). However, due to the expected slowing demand when the economy shifts into recession along with a tight supply of available housing, many industry insiders don’t believe there will be a great drop in housing prices. Despite this prediction, it is important to be aware that no one is fully certain how this crisis will affect home prices. This is because there is no definite end date and the market currently still has low interest rates along with low inventory. 

Houses for sale in New York City

Despite the tight supply pool of houses available during this COVID-19 pandemic, there are still plenty of houses for sale in New York City! If you’re wondering how to find a home to buy during these stay-at-home mandates, Localize is a great resource to not only search listings, but our insights show you everything you need to know about the apartment unit, building, and even surrounding neighborhood.

We do the intensive research for you, so you can easily house hunt in the comforts and safety of your own space. Here are just a few available apartments and houses for sale in NYC you might like right now:

Manhattan

what does pending mean on a house
42 Crosby Street, #5N Soho, New York

Brooklyn

can a realtor show a house that is pending?
429 Kent Avenue, #TH14 Williamsburg, New York

Queens

Bronx

What Is Contingent and Pending in Real Estate?
55 Island Point City Island, New York

Staten Island 

Housing demand may have started to bounce back from coronavirus impact
216 Neal Dow Avenue Westerleigh, New York

Although the New York City real estate market has been hit due to the pandemic, it’s still standing strong and many believe it’ll bounce back when life returns to normal.

With the extra time on your hands, Localize is here to help make your home search easier with our insights on every listing in the market. We’ll tell you the truth about any home so you can comfortably house hunt right from your home! 

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