RealtyHop Market Health Report: April 2020
In this April edition of the RealtyHop Market Health Report, we investigate the strength of the 100 largest housing markets across the United States. To do this, we analyzed over 300,000 real estate listings on RealtyHop to calculate the “market health” of each city; specifically, the difference in price between when real estate listings are first put on the market and when they are eventually sold. In theory, stronger markets should exhibit fewer price drops and smaller percentage discounts, while weaker markets should show the opposite. Our results explore this metric and shed light on the market health of cities across the U.S. right now.
1. Chandler, Arizona took the top spot as the hottest housing market in the country this month. The city saw the lowest price drop per listing at 1.82%, equating to $7,360 off of the original list price.
2. Gilbert, Arizona close neighbor to Chandler, came in a close second. Listings in Gilbert only required a 1.92% drop in order to be sold or taken off the market, representing $10,000 off the list price.
3. Colorado Springs, Colorado saw listings this April require a small 2.04% drop in order to be taken off of the market, equating to $9,953 of the total sales price. The city remained in third place despite requiring slightly steeper discounts compared to last month’s figure of 1.9%.
4. Mesa, Arizona increased one spot to become the fourth hottest housing market this April. Mesa real estate required a $8,000 drop in order to be sold, equating to 2.11% of the original asking price.
5. Plano, Texas dropped one spot to take fifth place. Listings in Plano required a slight 2.15% price drop in order to be sold or taken off the market. This constituted an average of $10,000 off initial list price.
1. Detroit, Michigan continues to be the hardest market for home sellers in the country. Listings in the city required steep discounts in order to be sold; on average, a newly listed property required a 8.18% price drop in Detroit. On a positive note, this was an improvement over March’s 8.65% statistic.
2. Cleveland, Ohio was the second coldest housing market in the country this April. Properties in Cleveland saw a median price drop of $5,000, or 7.2% of total list price, in order to be sold or taken off of the market.
3. Newark, New Jersey saw listings require strong discounts in order to be sold this April. On average, a new listing in Newark required a $15,500 discount to be sold, equating to 6.99% of the total initial asking price.
4. Buffalo, New York continued to be a buyer’s market, as housing listings required a $10,000 price drop to be taken off of the market. This equated to roughly 5.81% of total list price.
5. San Jose, California dropped one spot to take the fifth coldest market position this April. A real estate listing in the city required a 5.24% drop in order to be sold or taken off the market.
COVID-19 Impact on Market Health
This report was the first time our dataset included a full month of post COVID-19 shutdown listings. While the full effect of the pandemic has yet to be seen (given real estate historically lagging other markets), it can be argued that preliminary trends could be seen this month, especially in the initial cities hit by the pandemic.
Cities in our report, on average, saw larger price drops this month compared with last month. The median price drop of all 100 cities on our list was 3.18% last month, compared with 3.27% this month. Seattle, one of the first cities to be hit by the pandemic, saw considerably higher price drops when compared to the month prior’s dataset – 5.07% this month, compared with 3.66% last. In fact, Seattle dropped 16 spots on our list, and became the 6th coldest market on our report this month. We have yet to see material impacts in cities such as San Francisco and New York.
We will keep an eye on the full impact of the COVID-19 shutdown in subsequent reports, as trends start to show themselves in our dataset.
The RealtyHop Market Health Index analyzes proprietary data gathered from RealtyHop over the month prior to publication, providing a snapshot of housing market health across the 100 most populous cities in the United States. Price changes are taken from over 300,000 real estate listings on RealtyHop to identify each city’s “market health” based on the change in asking prices over the past month.
To calculate the index, the following datapoints are used:
1) Median home price taken from 300,000 listings on RealtyHop.com over the course of the prior month to publication
2) Median price change per listing: the median amount the asking price per listing changed prior to being sold or taken off the market
3) Median price change as a percentage of total sales price: the percentage of the total home price that the price change represents
Cities are ranked in descending order by Median Percentage Price Change.