The spread of the Novel Coronavirus COVID-19 pandemic through-out the global community has caused the entire world to come to a halt.
With 2.6 billion people, or almost a third of the world’s population now living under some sort of lockdown quarantine, persons everywhere have been forced to follow precautionary measures that require they stay at home and also avoid crowded places.
The impact on consumer spending that would occur from a stock market downturn also cannot be ignored. Some would-be home buyers feel compelled to push pause on their plans to purchase a new home because they remain worried about their health along with the fate of their jobs. Despite the on-going crisis, applications to purchase a new home are again on the rise with new trends on how properties are bought and sold.
Taking advantage of the stock market crash
According to one report, major financial indexes have fallen by more than 20% since the start of the year, indicating that the US has officially entered a bear market. Buyers and sellers are receiving mixed signals due to fears of a housing crash similar to others that have occurred during disease outbreaks, such as the 1918 influenza epidemic and Hong Kong’s SARS contagion in 2003.
It should be noted, that even during these occasions, economic activity fell sharply during the period of time the epidemic raged, but rebounded quickly once it ran its course.
Currently, both economists and real estate agents are predicting that home buying will stagnate during stay-at-home periods, but are confidently expecting things to rebound once government restrictions are lifted.
In light of this, it’s probably best you take advantage of these circumstances by doing research with the intention of scoring a great deal on your next home purchase.
During this time, there is a very real possibility of low competition in the areas you plan to move to as sellers may be more motivated to let a property go at a more flexible price.
Once the current crisis passes, there may be more house hunters back on the market, and prices may escalate due to a more competitive marketplace that benefits sellers rather than buyers.
Consequently, taking a few steps forward could turn out to be the right move for you.
Virtual Home Viewing
A trend that is quickly emerging is that more and more people are learning about how the housing market is quickly transitioning toward virtual operations. Plenty of buyers are now conducting the bulk of their search via a computer or mobile screen.
In fact, according to the survey conducted last may by the National Association of Realtors’ (NAR), they found that among members who had a buyer for their listed home, 22% said the purchaser had only seen the property virtually.
Around the country, real estate agents are now faced with an assortment of stay-at-home orders. For example, in Maryland, restricted in-person shows are limited to no more than three people by appointment, while in D.C., open houses are currently prohibited.
One of the few bright spots is in Virginia where open houses are still allowed. However, Virginia Realtors the possible liabilities associated with this practice. But in general, home showings are continuing, albeit under variety of social distancing guidelines.
Due to the fear and anxiety from the pandemic, would-be sellers are also taking their property off the market because they don’t want people coming into their homes and possibly causing contamination.
Similarly, agents are also nervous when showing homes and are exercising caution by bringing wipes and masks whenever they have an open house. For those who are serious buyers, it is highly advisable to wear masks and gloves.
It is also likewise important to keep in mind that homeowners are leaving the lights on and closet doors open, in order to have visitors avoid touching the surfaces. They’re doing this as a precaution against possible disease spread.
The new real estate normal of home tours have now gone online with agents offering virtual tours of properties for sale on their websites, and on social media pages such as Facebook, Instagram and YouTube.
Potential home owners can now take a virtual tour or attend a virtual open house and instantly get a realistic view of the property. Now more than ever, it is easier to look for that dream house. With a simple click of the mouse, they can now see all of the important details needed to make a purchase decision.
Shift from cities to smaller communities
Another trend that we are noticing, even prior to the Covid-19 pandemic is that the housing affordability crisis was already driving people from large cities to small ones. Now, more and more Americans are choosing to flee cities and move to less crowded towns, valuing extended distance between themselves and their neighbors.
Online searches for housing in small towns and suburbs are growing at nearly twice the rate than queries from that of major metropolitan areas. Moreover, Data from the Harris Poll found that almost a third of Americans are thinking about moving to less densely populated areas.
In yet another study, 43% of city dwellers admitted they had recently checked a real estate site for a house or apartment to rent or buy as compared to 26% of those in the suburbs, and 21% of those in rural areas.
With remote work or work from home becoming more prevalent, buyers now look for a different home feature such as a home office, a gym or an extra room where relatives can stay. Since there is now less need to be close to the job centers, less crowded communities such as suburbs and exurbs (areas situated beyond the suburbs and in, or adjacent to, rural areas) are now gaining interest from buyers.
No-contact contract signings
Home buyers will now notice that when buying a home, much, if not all, of the process has gone virtual. Brokers are able to seal the deal over FaceTime and other platforms. Also, instead of signing documents in a courthouse or office conference room to clinch a sale, documents are signed remotely.
According to the Mortgage Bankers Association, 24 states now allow documents to be notarized remotely and 19 more passed executive orders to enable online signings after the pandemic hit. These changes aren’t likely to disappear any time soon.