I know y’all are tired of hearing about Covid-19 — better known as “The Coronavirus.”
But I want to touch on a couple of things related to its effects on our local real estate market.
Now, let me start off by saying, regardless of your personal position on the Coronavirus — whether the response is over-hyped, under-hyped, or completely appropriate — the effect on the market and economy are very real. This is something we have to deal with, whether it’s short or long term.
Firstly, you’ve likely heard that The Federal Reserve slashes interest rates to near zero.
This does not mean mortgage interest rates are zero.
There are many factors that dictate mortgage interest rates. I am not a loan officer, so this is not my area of expertise. You need to seek the counsel of a competent mortgage professional. If you do not know one, I can make some excellent recommendations.
Mortgage rates are still very low. It’s a good idea to speak with a professional to determine if you should be looking to refinance your current home.
As you can imagine, we’re seeing a decline in home buyer activity.
I’ve been paying close attention to local and national real estate forums. It’s being widely reported that buyers are holding off, and in a few extreme cases, withdrawing from contracts.
This, of course, is due to the uncertainty of the situation. It’s early and people are largely in a wait-and-see mode.
There is still activity in the market -- buyers are still buying and sellers still listing their homes.
One thing buyers need to keep in mind is the potential for delays. If they go under contract there will likely be new contingencies related to the virus and what happens if it causes a delay in the sale.
Another factor is the ability of local governments, lenders, and other related service providers to do what they do to complete the process.
It seems most of these entities are figuring out how to continue to do business during this time. But that could change if circumstances dictate it.
For our active sellers. I would say, be patient. There are and will be buyers still circulating.
If you become concerned about contamination, we have an action plan to help reduce exposure. But at this time, that will depend on the overall situation with the virus and recommendations from the authorities. If it becomes too serious, we can look at other options. In some cases, temporarily removing your home from the market might be best.
If you are looking to put your home on the market in the next couple of weeks, we’ll have a discussion and come up with an action plan that best fits your situation.
For sellers who are looking to list in the coming months, at this point, I say it’s best to keep moving forward. A lot can happen in the coming months and we’re still here hard at work. We can make adjustments as the situation dictates.
Housing demand might dip for a while. The number of days it takes to sell a home will likely increase in the short term as buyers adopt a cautious and “wait-and-see” approach to home buying. But this is likely short term (hopefully).
Interest rates are still very low, housing inventory is very low, and demand has been very high.
Buyers who don’t see a direct impact to their financial situation will be ready and waiting. Some buyers may have a temporary setback but will more than likely come back once it’s resolved.
Once we get on the downward side of this situation, people’s confidence will rise and many people will come right rushing back.
We just don’t know if we’re taking about weeks or months…(or longer).
REMEMBER, this is just a moment in time — not eternity. Things will rebound — we just don’t know when. But when they do rebound, look for it to come roaring back.