April Market Report: Spring Shopping Season Gets Upstaged
For agents, the most important day in March usually falls on the 20th. But the official start of spring got upstaged this year by Friday, March 10. That’s the day Silicon Valley Bank (SVB) shut down, sending shockwaves throughout the economy. The ensuing banking uncertainty has cast interest rates into more volatility.
It’s a complicated story that could both hurt and help your clients. Which fits right in during 2023, a year that has already been plenty complicated for agents. To make sense of the latest trends and economic signals, dive into our latest market report.
Silicon Valley Bank fell, then mortgage rates followed
Key stat: Prior to SVB closing, 30-year fixed mortgage rates increased for six consecutive weeks. Since then, they’ve decreased nearly 0.5%.
“Home buyers have been very responsive to mortgage rates in recent months,” Zillow Chief Economist Skylar Olsen explained in March. “Today, falling mortgage rates could thaw what was shaping up to be a fairly frozen spring home shopping season.”
Takeaway: Stay ready. SVB’s collapse may have provided unexpected short-term relief. However, there could be long-term fallout in housing if still more banks suffer similar issues that lead to job losses and a recession.
Home values hold steady — except in some major markets
Key stat: National home values are up 4.4% year over year. But 18 of the 50 largest metros saw home values decrease, including 12 cities in the West.
Price volatility by region is another way the 2023 spring shopping season differs from the past few years. In California, home values are down in traditionally expensive metros like San Francisco (-7.73%), San Jose (-6.10%), and Los Angeles (-2.41%). Meanwhile, in Florida, Miami, Orlando, and Tampa homes are all up more than 5% year over year.
Takeaway: “This is a good reminder the market is not a monolith,” Tucker says. “Affordability is still an issue across the country, but home values have been coming down in some areas, especially out West, which might open up windows for some buyers.”
New listings are lagging, but well-priced homes still sell
Key stat: New listings dropped 22% year over year, but median pending sales only needed 17 days to go off the market.
While inventory is down overall, desirable properties are still drawing buyers at a healthy pace. In February 2020, newly pending sales took 22 days to go from listed to pending. “Homes priced correctly still have a good chance to sell quickly,” says Zillow senior economist Jeff Tucker, “just not at the light speed that was common in 2022.”
Takeaway: When setting the price, agents should aim to find a middle ground that balances realistic market conditions with client expectations. “Today, it’s more crucial than ever to do your research,” Tucker says. “Setting a good price is specific to the home and the area, so use a data-driven tool or dashboard to come to a logical number.”