March 20 2020

To Buy or Not to Buy? Is Buying a Home During the Coronavirus Pandemic a Good Idea?

by racheal

For sale sign in front of a new home

The Coronavirus also known as COVID-19 has many people up in arms across the globe and for good reason with over 13,000 known cases reported in the U. S. alone.  This virus has hit the economy in a major way with an interruption and even a complete halt of supply chain productions. Along with the travel industry and foodservice industry, this is bringing up concerns for the future of the real estate market during these trying times. Not even real estate is immune from the impact of the Coronavirus.

 

The Pandemic has affected everyone

 

Due to the urge of having to self-quarantine and the push for school closures across the U. S. for several weeks, many American workers have been forced to stay at home with their children, and many have been left jobless as a result of this. For those companies that do not offer the option or ability for their employees to work from home, many are left wondering how they will be able to pay their bills and feed their families in the coming months. Many small business owners have also seen a vast decline in sales with people remaining isolated.

 

Emotions are leading most decisions to buy real estate right now

 

With stats changing daily and many living in a world of uncertainty, it can be easy to question what to do with some of the biggest financial transactions such as buying or even selling a home. Although many people will have less money and less access to funds during this time, the real estate market has not yet been deeply affected as some may think. There is a slight decrease in both buyers and sellers due to the current state of the world right now based mainly on emotion. 

 

Some seem more optimistic and eager to buy while rates in the housing market are so low. Those willing to enter the housing market with high hopes have the benefit of low rates and are jumping on the opportunity pretty quickly. The housing stock will be more attractive to many than what it is to rent being that some are currently considering buying a new home to take in more family members during the time because of the effects of the pandemic.

 

There may be opportunities for price discounts for those buyers that choose to stay in the market during this time while others are pulling out allowing their emotions to get the best of them which is truly understandable.

 

What does the future of the real estate market look like?

 

There is a possibility that history can have its way of repeating itself. We can look at recent historical events such as the Swine Flu, SARS epidemic, and MERS and other aggressive Flu strains to get an idea of how the COVID-19 will affect the housing market in the coming months. History has shown that the housing market typically can remain stable during disruptions like these with only a slight fall in sales. Although this may be true, the economic impact of the pandemic COVID-19 is greater than the impact of SARS and others like it. It may take a little longer to see a significant rise in sales again when things finally begin to blow over.

 

As far as a long term outlook on the effects of the Coronavirus to the housing market, home prices may remain flat or creep up slower than they have since 2012. In short term, realtors are already seeing a decline of 10% in home sales due to loss of employment with citizens having to self-quarantine and make use of social distancing to reduce the risk of spreading this virus.

 

If you are on the fence about what your next steps should be during this very uncertain time, just know that you are not alone. The decision of whether or not to buy or sell during this time is simply situational. Take the time to weigh out the pros and cons and evaluate your current and possible financial situation to make the decision that is best for you and your family. The coronavirus will have a positive impact on the U. S. Real Estate market if the interest rates remain low and if you are willing to take the risk, right now is a good time to get your feet wet and experience more inventory, low-interest rates, and better pricing.

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