The corona-virus pandemic has impacted the real-estate industry tremendously. Is this a good time to invest in property? Should you buy a house?
It depends on whether you are an investor or a buyer.
“It’s a good time to buy an investment property if you can find inventory at a good price,” said Daren Blomquist, vice president of market economics at real-estate website Auction.com.
As soon as the corona-virus pandemic began to prompt the stay-at-home orders, it overturned the home-buying process. Companies that monetized buying and selling homes as a profit, put a temporary pause on operations. Because of social distancing, Real Estate agents had to resort to using virtual open house tours and remote closings.
A combination of this changes and the rapid rise in unemployment, prompted sellers to pull their listings. At the same time, new-home construction declined in April as many builders raise concern about the housing industry.
With all this being said, doesn’t mean you can not still buy, it just means you can’t expect a lower price or as many options.
Before the corona-virus crisis, economists warned that the U.S. housing market was scarce. Years of slow home-building activity in the wake of the financial crisis created an issue of supply and demand. The apprehension among home sellers and builders could exacerbate that problem, In the midst of this crisis we are already seeing buyers return to the market, especially in areas with loosened stay-at-home orders such as Atlanta.
There are some categories of properties that could become potential markets such as vacation homes. Since the downturn in travel, many of these owners used these short term rentals to pay their mortgages. Similarly, many mom-and-pop landlords are struggling as tenants miss rent payments. This calls for great opportunity for Savvy investors by making an attractive offer to these property owners.
Consider your end goal. Those looking to buy a home and hold onto it in the long term, particularly as a rental property, won’t face as much risk. For someone looking to buy a home and flip it, this is could a risky bet given the unclear circumstances of the real estate market.
Many economists predict that home prices will continue to rise but it depends on the economy’s ability to bounce back from the pandemic. Home price appreciation has slowed so far, but prices are still rising.
