Buying a home during the COVID-19 crisis seems like a crazy idea.
This health pandemic, which has taken hundreds of thousands of lives across the globe and crippled economies in virtually every major country, has also created challenges for the real estate industry. Many would-be buyers are choosing, rightfully so, to wait until all of this blows over; for a vaccine, for more information on the severity and spread of the coronavirus. For anything that gives a sign of hope. Once that happens, the real estate market will take off like a rocket.
But people are still buying, even if it’s at a far lower rate. For some, there is no option, as they may have been forced to take a new job in a different location. Others may be thinking about buying and wondering if buying a home during the COVID-19 crisis is the right choice.
The decision to buy is personal, and depends on numerous factors, including job stability and future goals. As you’ll see, there can be many reasons to buy, even if the COVID-19 pandemic is still looming over the country.
Benefits of Buying a Home During the COVID-19 Crisis
To be completely clear, as a country we would have been far better off if this health crisis, which has led directly to an economic crisis, had never happened. But the COVID crisis has happened, and we need to be honest about where we are and what we can do.
Looking at the situation with this honest mentality, we can still look at the advantages of buying a home during the COVID-19 crisis.
Less Competition from Other Buyers
Because so many would-be buyers are choosing to wait out the COVID-19 crisis, there is far less competition for a single home. Before, where you might have had hundreds of potential buyers, that number could be down to a dozen or less. As a buyer, this means you have far less competition for each and every home, which could potentially translate into a higher chance of having your bid accepted, and it could mean that you will look at far fewer homes, speeding the overall process.
You may even be able to take your time (if you desire) and make a well-thought-out decision, a novel concept in many hot markets where homes are sold almost instantly. As a buyer, you were under a lot of pressure to make a choice immediately, before the home was swept away; now you might be able to take your time. (Again, if you want!)
Houses Could be More Affordable
This is directly tied to the fact that there will be fewer buyers on the market. With fewer buyers, there is the real possibility that your below-asking-price offer will be accepted by the seller, helping you save thousands, possibly tens of thousands on your purchase. While a drop in housing prices is rarely a good thing (from an overall economic perspective), it could mean you can purchase the luxury home you have always dreamed about.
Closing Process Could be Faster
When you do decide to purchase a home, and you come to terms on a sale, the process could be much faster than in a normal market. When the real estate industry is humming along, mortgage lenders, contractors, appraisers, and inspectors are backed up for months at a time; it can often take three months to finalize a sale.
But now, these professionals have a much longer waiting list. Your mortgage can be processed quickly, your appraisal could happen within a couple days, and all inspections could be completed almost immediately. This allows you to close a sale and move into your new home as fast as possible.
More Real Estate Organizations Likely Adopting Remote Technology
The sales process is changing, and it’s likely going to chance for good after the COVID-19 crisis. One of the most important and noticeable changes will be the adoption of remote technology used during a sale. Virtual tours won’t be a rare convenience for high-end firms, it will likely be a common tool used by a majority of real estate professionals.
This means the buying process on your part could be easier, as you could “tour” a home without actually setting foot on the property. Buying a home “site unseen” has for years been a touchy subject; most people would never buy without seeing the home. Virtual tours give a much more comprehensive detail of the home, creating a better shopping experience for you even when you don’t visit the property.
High-Quality Foreclosures and Pre-Foreclosures Could be Available
This is mere speculation, but in the previous economic decline foreclosures became more common. It’s always sad when someone loses their home, but you may be able to purchase a property at a great price, either through a foreclosure or a pre-foreclosure sale.
If someone is approaching a foreclosure, they may be willing to sell the home at a significantly-reduced price just to be free of the payments. This might allow you to make a great purchase
Low Interest Rates
Interest rates are at an all time low, and this means the cost of purchasing a home is significantly reduced. Conventional financial wisdom holds that if you want to stimulate the economy, one of the most reliable ways to do so is lowering interest rates, which encourages borrowing and financial activity. Interest rates were already low, as the federal government wanted to maintain economic momentum, and they have been lowered even further because of the COVID-19 crisis, which has forced lenders to slash rates to stay competitive.
If you buy a home during the COVID-19 crisis, you could save tens of thousands of dollars on your total purchase cost thanks to low interest rates.
A Reliable Team, Before, During, and After the COVID-19 Crisis
If you are interested in taking advantage of low interest rates, contact our team today. We’ll help you find a loan that fits your needs and helps you purchase a world-class house!