Friday, March 27, 2020
Toilet Paper, Anyone?
Last week of March is typically the busiest week of the year. Things are different this year with many would-be visitors cancelling reservations and snowbirds departing early because of the corona virus. All bars are shut down and restaurants are doing takeout or delivery only. All beach streets and parking are blocked off and beginning today the beach itself is closed everywhere in Brevard County from 11 AM to 4 PM for Friday Saturday and Sunday. That could change. Traffic is very light and there are very few cars parked along the streets downtown. It's an eerie pre-hurricane vibe.
Not surprisingly, real estate activity has slowed dramatically. The last three weeks of February we were averaging 26 new residential contracts executed per week in Cocoa Beach and Cape Canaveral. That started slowing in early March and was down to thirteen last week. So far this week we are showing just nine executed contracts. The number of new listings so far does not appear to be changing. It's too early to tell if the reduced buyer activity has impacted prices. We won't see the impact in closed sales numbers until next month when this month's slowdown in executed contracts will begin to be evident. As we're just now closing contracts from January and February, the March numbers are still looking good.
I'm hearing talk about changes in the secondary mortgage market which is being reflected in more stringent borrower requirements. Jumbo loans are particularly affected. Debt to income requirements have become more stringent as have credit score thresholds. Self-employed borrowers have a new set of higher hurdles to clear. Regardless ones situation, getting a mortgage now is more difficult than it was a month ago and some who could qualify last month may be rejected this month. Talk to your lender again if you're looking to purchase. The rules have changed and what you thought you could borrow in February may not be possible today. There is a strong possibility that we will start to see existing contracts fail to close because of these changes.
We've closed 50 condo units and 15 single family homes so far in March. Median price is just under $300,000 for condos and $540,000 for single family homes. Inventory for sale this morning is 225 condo units with an additional 21 in yet-to-be-built buildings, most of those in the Surf at Cocoa Beach downtown which is yet to break ground. There are 55 single family homes for sale in the two cities.
Vacation rental properties are being hit hard with cancellations due to the virus outbreak. If the beach closing is extended to include weekdays we can probably expect remaining rental demand from those within driving distance to dry up completely. Both grocery stores in Cocoa Beach are doing a seniors-only hour every morning to give us old folks a chance to snag a roll of toilet paper with relatively light customer density. I don't think they thought this one through very well as it isn't playing out as planned. A skewed to senior population means the old-timer hour is the busiest time of the day.
We are not under stay at home orders yet but that may be coming. I may have to actually clean out the garage if that happens. So far, we're eating really well and are treating the evening meal as the highlight of the day. Leisurely taking a couple of hours to prepare the meal is therapeutic and enjoyable.
Most restaurants in Cocoa Beach are offering curbside pickup for take-away including the Fat Snook. Growlers of draft beer and margaritas (among other drinks) are available for take-away with your food from the 4th St. Fillin Station downtown and at least one Cocoa Beach eatery is including a roll of toilet paper with every delivery while supplies last. Please support our eateries if you can. This is a hard time for those who serve and feed us. In lieu of ordering takeaway, consider buying gift cards to use later. Every little bit helps.
Best wishes to everyone and hope we can all emerge from this with the slightest of scars.
"It doesn't matter if you buy or sell today, the important thing is that you panic." __Josh Brown