Coronavirus Real Estate Myths Debunked
Have you heard that it’s a terrible time to sell a home since real estate prices are plummeting? Or that the coronavirus has forced all city dwellers to flee to the suburbs?
These misguided beliefs can lead to missing out on some profitable opportunities. Let’s compare these myths to reality.
1. It’s a terrible time to sell your home. On the contrary, the latest statistics suggest that now is one of the best times in years to sell a home. According to Danielle Hale,
chief economist at realtor.com, “the data suggests that buyers outnumber sellers in the housing market, which means it’s better to be a seller than a buyer.”
2. Home prices are plummeting. Data shows just the opposite. Home prices are actually rising. According to the National Association of REALTORS (NAR), the national median price for single-family homes grew 7.7% during the first quarter of 2020. “We’re seeing home prices grow faster than pre-COVID-19,” Hale says. “In fact, they are on pace with the home price growth we saw this time last year.” The reason is record low mortgage rates which boost buying power.
3. Buyers are holding off on home purchases. According to the NAR, pending home sales jumped 44.3% in May, the largest month-over-month increase since the index’s inception in 2001. Buyer demand is being fueled by low interest rates which dipped below 3% for the first time in 50 years to 2.98% in July.
4. Everyone’s fleeing cities for the suburbs. While this rampant myth makes sense from an impulse level, it is only partly accurate. Data has shown that listings in the suburbs are drawing more attention. In May, the number of views on properties with suburban ZIP codes increased 13%, almost double those in urban areas, according to realtor.com.
That doesn’t mean everyone is fleeing to the suburbs, though. Many of those people surfing suburban real estate listings might fantasize about moving, but when it comes to making an offer on a house and packing up their belongings, many may prefer to stay put and see how the pandemic shakes out.
5. Homes can’t be viewed in person. Stay-at-home orders and social distancing mandates put a hold on in-person home showings and open houses. Now, these restrictions are being lifted in many areas of the country so homes can be viewed in person with extra safety measures in place.
As an added precaution and to eliminate non-serious buyers, in some areas potential buyers are required to have pre-approval letters before they can see a home in person.
In areas where infection rates begin to rise, restrictions on home showings may be reinstated. Give me a call to discuss current guidelines in our local market.