The impact of Covid-19 on the economies worldwide cannot be overemphasized. As of now, most governments, businesses, and citizens alike are still bearing the brunt of the pandemic.
The real estate market has not been spared either, as buyers and sellers weigh their options. Most of us are left wondering whether to buy or sell our homes amidst the current real estate market situation.
During the peak of the health crisis, home prices rose, yet demands were down compared to previous years. Several indicators contributed to this phenomenon, and to home sellers, it was good news.
On the other hand, buyers had many considerations to make, and some are still contemplating if buying a new home is the best idea as Covid-19 keeps lurking in all our minds. Keep reading to see how we analyze the pros and cons of selling or buying a house during a pandemic.
The Impact of Covid-19 on the Real Estate Market
The Covid-19 pandemic has dramatically affected the real estate market. Governments worldwide introduced several measures to help contain the spread of the virus, including restricting citizens at home during the beginning.
Consequently, the desire to buy or sell a home dwindled. Most first-time buyers also held on to their search for a home. The pandemic came with economic difficulties. Most people lost their jobs, and others had to accept pay cuts.
This affected the decision to buy a new home. Ideally, the reasons mentioned earlier should have led to a drop in home prices. However, it was the other way round. Prices were steady, while some went up despite the global health crisis.
Pros and Cons of Pandemic Home Sales
If you are contemplating selling your home during a pandemic but are unsure whether to proceed with it, you are not alone. Many other people are in the same shoes and dragging their feet on making that tough decision.
To begin with, Covid-19 appears to be staying longer than anybody ever anticipated, and there continue to be new strains of the virus popping up every couple of months. Are you ready to hold on to your home until such a time? If your answer is no, then here are some steps to take.
First, you need to discuss your decision with your real estate agent. With their vast experience in the market, Real estate agents can help you make the right decision. Even if you wouldn’t want an in-person inspection of your home due to Covid-19, you can arrange for virtual options.
Virtual Home Viewing
With Covid-19 still hanging around, most home sellers wouldn’t want strangers coming around for home inspections. The good news is that technology has a solution for such a situation. With a video app, sellers can arrange for a virtual home viewing with the buyer.
This can reduce the limitations of people not being able to have a personal tour of your property. In the comfort of their homes, you can give prospective buyers an in-depth view of your home using Skype or Zoom video calls.
Alternatively, you can video record every detail of your home and forward it to them. You can also post the videos on various social media sites to attract buyers.
Other pros of selling your home in a pandemic are:
Higher Price
The current high housing prices are advantageous if you decide to sell your home now. No realtor or real estate expert ever imagined that homes value would increase during a pandemic.
As a homeowner, this is good news as you can refinance your mortgage with confidence and get a new home of your choice from the sales.
Higher Demand
It is much easier to sell your property now, as the demands are very high. With fewer homes on the Sacramento real estate market now, you can get a good deal without waiting months to close.
Cons
Coming into Contact With Sick People
Some shoppers have trust issues and may not agree to the virtual viewing stuff. You may have no other option but to allow an in-person inspection. This can be dangerous because you wouldn’t know the Covid-19 status of that shopper entering your home.
If they happen to be carriers and touch things during the visit, you may end up catching the virus, or at the least, you’ll need to have your home cleaned thoroughly afterward.
Pros of Buying Your Home in a Pandemic
Current Low Mortgage Rates
Despite the pandemic, mortgage rates are very low, thanks to the current low rate of interest. Governments have implemented several measures to bring the economy back to life, including reducing interest rates to give borrowers some respite.
As borrowing money has become cheaper, lenders have reduced mortgage rates; hence, making it affordable for people to own a home. Buying a house in Sacramento has therefore become easier with cheap mortgages.
If you seek to refinance your mortgage, now is the time to take advantage of the current low rates. However, this won’t last, so you need to act fast to lock in the best rate if you’re serious about refinancing.
Growth in Equity
As home prices are on the rise now, the value of your old property has definitely increased with all things being equal. Selling it off to buy a new one means you may have extra money thanks to the high prices.
But keep in mind, if you need to buy something else in the same area— you’ll also be paying top dollar.
Cons of Buying a New Home in a Pandemic
Current High Prices
With sellers hesitating to sell their homes, the demand keeps increasing. As needs outweigh supplies, prices rise automatically. The current high price becomes an advantage when selling but a bane when buying.
After selling your old home for a high price, expect your new home to be more expensive. Depending on your preferences and location, you may need more money to purchase a new home.
Demand and Supply
The current demands for new homes are higher than the number of houses for sale. With fewer homes on the market, the competition is more brutal, and you may not get the home of your choice.
The fear of someone outbidding you or running out of options may force you to agree to an outrageous deal or a home below your expectations.
Conclusion
You should always weigh your options as you try to buy or sell your home during a pandemic. There is no perfect one size fits all solution for navigating the real estate market during times like this. Partnering with a real estate agent who knows the market dynamics in your location can help you make the best decision.
