Are Buyers Readying to Reenter the Market En Masse?

Are Buyers Readying to Reenter the Market En Masse?

To get a picture of buyer behavior, our data scientists analyzed trends in three key metrics: properties shared by agents, properties viewed by agents, and properties favorited by agents. These metrics offer a clear view of buyer intent and sentiment,  as agents who are actively sharing, favoriting, and viewing properties are doing so with their buyers.  This is what our data scientists found:

In a normal year, real estate buyer activity follows a predictable hill-shaped pattern. After a winter lull, home search actions ramp up in the early spring and maintain consistency throughout the summer before tapering off in the latter half of the fall. 

It looks a lot like this:

Source: Homesnap

The graph above depicts the number of properties agents shared with their clients per week from January 1 to December 31, 2019. As you can see, total properties shared climbed steadily throughout the early months of the year, peaked during the week of April 1, maintained relative consistency throughout the summer (only majorly dipping July 4th week), and then declined in mid-November. The same pattern can be found in the other home search actions: properties viewed and properties favorited. 

This year, though, has looked quite different. If we zoom in and look at the first few months of 2020 and compare them to the same time period last year, this is what we get.  Note: 2020 is blue, 2019 yellow.

Properties Shared 2020 vs 2019

Source: Homesnap

Properties Favorited 2020 vs 2019

Properties Viewed 2020 vs 2019

Source: Homesnap

COVID-19 stops busy season momentum

The beginning of the year started out promising, as across the board, home search activity volume was higher than the previous year. Home search activities also followed the expected upward trajectory, increasing in volume every week for the first ten weeks of 2020, mirroring what we saw in 2019.

Then, in mid-March, due to COVID-19, all three home search activity metrics plummeted drastically. The per-week volume of properties viewed, shared, and favorited in 2020 fell to their lowest points since early January, reversing steady week-over-week growth.

Even more concerning, volume for each metric fell year over year. Despite 2020 starting with greater buyer activity volumes than 2019, by mid-March, properties viewed volume fell by 24.8%, properties shared fell by 12.5%, and properties favorited fell by 23.42% when compared to the same period last year.  The data clearly indicates that would-be homebuyers slowed or paused their plans amid initial COVID-19 concerns. 

A slow rebound

After hitting a two-year low point in mid-March 2020, home search activities slowly rebounded week over week throughout the rest of the month and into April. However, total home search activity volumes never returned to 2019 levels. In fact, for most of these weeks, buyer activity volumes were closer to dead-of-winter levels than what you’d expect at the start of busy season.

May brings a turnaround

As we entered May, though, buyer activity volumes for all three metrics surpassed last year’s totals for the first time since the first ten weeks of the year. As of May 1, properties viewed volume was up 14.79% year over year, properties shared was up 35.26%, and properties favorited was up 35.67%.

So, does that mean buyers are readying to enter the market?

It certainly seems that way. 

After pausing home search activity levels in mid-March, the data seems to indicate buyers have slowly eased themselves back into the market. Now, in May, when stay-at-home orders and social distancing guidelines are being eased in many states, we’re seeing buyer activity levels reach a level we would have expected to see in the early spring had they not been interrupted by COVID-19.

The data points to busy season not being canceled but delayed by about six weeks. Whether this pushes activity later into the fall or simply condenses the peak home-buying timeline remains to be seen. But, at any rate, it’s a promising indicator of things to come.