Buying a home during a pandemic might seem ill-advised, and indeed, some are hitting the pause button – but real estate experts are confident the market will rebound.
A recent National Association of Realtors (NAR) survey revealed that 48% of real estate agents reported that interest in buying a home had decreased thanks to the outbreak of the novel coronavirus. However, 69% of real estate professionals also said that they’ve seen no change in the number of homes on the market due to the outbreak.
“It is no surprise that buyer interest has decreased such a significant amount,” said Rogers Healy, owner of the eponymous real estate brokerage Rogers Healy and Associates. “Our world is currently operating amidst a vast amount of fear and unknowns.”
Healy said that he’s seen two kinds of buyers right now – those that are sitting it out, and those that are taking advantage of lower interest rates and less competition for homes.
Kay Wood, with Briggs Freeman Sotheby’s, agreed.
“We are still seeing new listings come on the market and go under contract, especially at more affordable price points,” she said. “Agents are getting very creative and embracing technology to safely show property remotely.”
“The decline in confidence related to the direction of the economy coupled with the unprecedented measures taken to combat the spread of COVID-19, including major social distancing efforts nationwide, are naturally bringing an abundance of caution among buyers and sellers,” said NAR Chief Economist Lawrence Yun.
No matter a prospective buyer’s tolerance for uncertainty, Healy recommends using a real estate agent to buy or sell a home – especially during this uncertain period of time.
“We are here to help guide those decisions,” he said. “The good news is that we are working around the clock to keep the market afloat and to keep business operating as close to normal as possible.”
Yun predicted that the market softening was temporary – and that most would not see a significant reduction in home prices.
“With fewer listings in what’s already a housing shortage environment, home prices are likely to hold steady,” he said. “The temporary softening of the real estate market will likely be followed by a strong rebound once the economic ‘quarantine’ is lifted, and it’s critical that supply is sufficient to meet pent-up demand.”
Healy and Wood said this holds true for the Dallas market, too.
“I think based on what we are seeing now, there will be some pent-up demand and buyers taking advantage of low interest rates,” Wood said.
“I am confident that even though people are laying low right now, the market is going to boom when things begin getting back to normal,” Healy said. “We are working behind the scenes to strengthen our strategies and systems, and are confident that we will come back stronger and better than before.”
The NAR’s survey, which was conducted March 16-17, found that almost half of the organization’s members said the stock market correction and lower mortgage rates balanced out for the most part, and saw no significant change in buyer behavior. More than 60% saw no change in sellers removing homes from the market, and four in 10 said home sellers have not changed how their home is viewed while it remains on the market.
On the commercial real estate side, more than half of those real estate professionals reported declines in leasing clients, and 83% have seen commercial buildings changing practices in light of COVID-19, offering hand sanitizer, cleaning more frequently, and increasing the number of tenants working remotely.
But overall, Healy said his advice to prospective buyers remains unchanged – even now.
“My advice still remains true – ‘Buy real estate and wait, don’t wait and buy real estate,'” he said. “It’s still OK to buy, that’s what we are here for.”
Wood said that the public can do a great deal to get the market back to normal, too.
“The more people respect shelter in place and social distancing, the less and the shorter the market disruption and the easier it will be for us to recover quickly,” she said. “This break is giving a lot of people a chance to reflect on what they want, to reassess their budgets, and spend record amounts of time on real estate websites.”