Zillow President Susan Daimler told CNBC on Friday that the housing market remains hot, despite the drop in pending home sales in the month of February.
The National Association of Realtors reported that signed contracts on existing homes declined more than 10% that month from January.
Daimler said it was just a blip rather than a trend, attributing the decrease to a persistent housing shortage and bad weather that rocked the country that month.
“All the indicators that we see say that this housing market … [continues] to be hot, and there are a lot of reasons for that,” she said in an interview on “Closing Bell.”
“What we know is that moving is on a lot of people’s minds, and we’re imagining a lot of would-be movers are going to come off the sidelines here,” said the president of the online real estate marketplace.
More homes could be put up for sale as the Covid-19 vaccine drive continues to make progress and workers gain more certainty about whether their companies will require them to come back into the office, Daimler said. Google searches about the homebuying and selling process are also up, another sign that the market could hold shape, she added.
Despite a recent rise in mortgage rates, the market is also being met by high demand as the “great reshuffling” plays out, Daimler said. Beyond urban-to-suburban flight, many people are simply looking to move into new spaces rather than escape the big city, she said.
“Those mortgage rates are really what feed the affordability,” Daimler said. “As long as those stay low and also we have this pent-up demand from buyers … it’s quite possible that we see a bunch of listings come on and there’s enough buyers to scoop them up and we’ll stay in this place we’re at right now.”
Even at an average 30-year fixed loan rate of 3.45%, up from 3% at the start of 2021, mortgages are still historically low, according to Mortgage News Daily.
Supply in the U.S. housing market is at severely low levels, putting pressure on homebuyers to place higher bids. Existing home inventory shrank nearly 30% in February from a year prior, with just 1.03 million properties on the market, based on data from the realtors association.