Last year, prospective homebuyers have faced a number of hiccups in the real estate market including low inventory of houses to meet the home buying demand, hike of prices in the entry-level properties, and some economic uncertainty. Unfortunately, experts’ prediction of 2020 is not going to be of much difference as that of 2019. Although in general, 2019 did cose pretty good, and 2020 started out just fine.
But then, the COVID-19 global pandemic happened!
It was so sudden the whole world was caught off guard totally unprepared! All of the industries were affected and the real estate markets were faced with further challenges. The already low housing supply has dropped even more as prospective home sellers had to put on hold their plans of enlisting their property for sale, while the potential home buyers’ decisions of acquiring a new house were also on pause.
This poses danger to the housing market as people are currently in doubt of things in these uncertain times. Still, the future of the market depends on the balance between supply and demand, disciplined financial underwriting, and overall perception of the people toward housing.
The entry-level houses for the time-being, will remain thriving, but sellers of the upper-tier market will most likely encounter problems with drop in offers.
On a positive note, price appreciation is expected to remain on a gradual upward direction.
Mortgage interest rates on the other hand have been cut down and are expected to stay low to balance things out.
Majority in the wave of interested buyers are the millennials age group and they somehow sway more into the entry-level housing market. This trend may actually cause a continued construction of the entry-level houses to meet with the demand of the millennials.
The baby boomers on the other hand are either retiring now and are seeking to downgrade home for retirement while others would choose to stay in the same place they have lived for years—which then will contribute to the drop of inventory rate.
The government is trying to prevent the further spread of the virus and so, precautionary measures have been implemented. Because of this, many businesses and establishments have closed causing a lot of workers being laid off from or lost their jobs entirely. This has resulted in a whirlwind of things in the real estate markets. This also contributed to the expected drop in home buying demand as these workers, who are mostly renters and have been planning to buy their own homes, would have to postpone their plans of getting one. Although the low mortgage interest would encourage others to buy houses thus balancing the number of demand.
The magnitude of impact of the novel coronavirus in the housing market is still too early to tell at this point. The key here is the duration of the virus scare, how long it will be contained or controlled, and how long it will take for the industries to recover and get back on track.
For now, what we can say is that you have to keep a keen eye on the market, and join community discussions (while still in quarantine of course, so do it online), and gauge the direction of the economy. By then, you can make the best decision.
Good news is, this is the time for the iBuyers to shine!
It is totally understandable if you have doubts and questions unanswered in the middle of this health crisis that caused economic disruption, and that’s when we experts in the field come in.
It is always good to know that you have someone to talk to in troubled times, and you can always talk to us at Mrs. Property Solutions. Particularly if you have been thinking of selling your property for a while now but only doubtful because of the current situation. We buy houses cash Los Angeles and provide a very fair, no-obligation offer. You can sell your home fast because we can close in as quickly as 7 days or on the schedule you prefer. You can sell your house for cash and consult us about it for free. The best part is that if you decide to let us buy your property, you are able to avoid upgrading it or accommodating house viewings from prospective buyers, because we will buy your houses as is and we will take care of the rest.