North State home sales are trending up this summer as demand to buy has been fueled by an extremely low number of homes for sale amid the global pandemic.
Both Brad Garbutt, a Redding relator, and Jordan Levine, an economist with the California Association of Realtors, said the low inventory in part is due to potential sellers who don’t like the idea of would-be buyers walking through their house in the middle of the health crisis.
“There is a lot of people who want to put their home up for sale and sell their home, but they are afraid to have people come through their home,” said Garbutt of Vista Real Estate, noting that selling a vacant home is not an issue.
“Both the economic anxiety aspect as well as the practical logistic aspect of selling a home are discouraging sellers,” Levine said.
Cindy Young, board president of the Shasta Association of Realtors, said the available homes for sale is so low that she has been talking to past clients.
"So I have been literally picking up the telephone to see if anyone wants to sell," Young said.
While some of her sellers are wary about COVID-19, Young said most are OK with putting their house on the market.
"I haven't met much resistance from people interested in selling the home that they live in," she said.
What's more, there are instances in which Young has to put a contingency into the sale that states the seller will find a home before the deal closes. She says that is something that doesn't occur in a normal market because there are plenty of homes for sale.
With the pandemic, the California Association of Realtors guidelines state that individual live showings can be done by appointment only. Open houses, which can attract crowds of potential buyers, are not allowed.
Rules for individual showings include that only a single agent and no more than two other individuals can be present during the showing. And anybody entering the home must declare that they are not sick with a cold or the flu.
Meanwhile, what also could be fueling sales in rural areas like Shasta County is families living in urban areas who are afraid of being infected by COVID-19. At $626,000, the median sales price for a house in California is more than twice Shasta County’s median of $295,000.
“I think people everywhere are looking to balance quality of life and housing affordability,” Levine said.
However, it’s too early to say if the pandemic phenomenon of urban dwellers discovering rural enclaves will last.
“There is just anecdotal evidence to that effect,” Garbutt said. “Whether it’s a long-term trend remains to be seen.”
There were 550 homes listed for sale in Shasta County earlier this week, approximately half as many as there were a year ago when 1,029 homes were for sale, Garbutt said.
Pending sales, or the number of homes in Shasta County that have entered into contract, were up nearly 40% earlier this week from a year ago, from 519 to 718.
Meanwhile, the summer home-buying season got off to a scorching start in Shasta County as sales were up 46.7% from May and 16.5% from the same a month a year ago, the California Association of Realtors reported.
That bucks a statewide trend that saw sales drop 12.8% in June from a year ago. California home sales were up 42.4% from May — the largest month-to-month sales increase in nearly 40 years, according to the California Association of Realtors.
“I think a lot of it has to do with that we were out of business for a month or two, so there is a little bit of a pent-up demand unleashing itself,” Garbutt said.
For the most part, it’s the same scenario in other North State counties:
- In Butte County, homes sales in June shot up 84.2% from May and were 1.2% higher than a year ago.
- Home sales in Tehama County in June were up 45.2% from May and up 9.8% from a year ago.
- In Siskiyou County, home sales were up 7.7% in June compared to May, but down 4.5% from a year ago.
While home values in Shasta County were relatively flat compared to May and a year ago, values in Siskiyou and Tehama counties were down both month-to-month and year-to-year. Values in Butte County were up nearly 8% from May to June.
Median sales price in June:
- Shasta County, $295,000
- Butte County, $390,000
- Siskiyou County, $213,000
- Tehama County, $240,000
California Association Realtors economist Levine said the market is rebounding after a significant drop when the pandemic took hold in late March.
“When we finally got our arms around this crisis and what it meant in terms of the labor market ... as that happened, we saw a reduction in mortgage interest rates,” Levine said. “Those low rates did start to entice buyers back into the market.”
The average for a 30-year, fixed-rate mortgage for a loan of $510,000 or less was 3.25% for the week ending July 24, the Mortgage Bankers Association reported.
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David Benda covers business, development and anything else that comes up for the USA TODAY Network in Redding. He also writes the weekly "Buzz on the Street" column. He’s part of a team of dedicated reporters that investigate wrongdoing, cover breaking news and tell other stories about your community. Reach him on Twitter @DavidBenda_RS or by phone at 1-530-225-8219. To support and sustain this work, please subscribe today.
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How low home sales numbers are helping boost the North State's housing market - Record Searchlight
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