There’s no doubt, the coronavirus will change the real estate industry, probably for good. Many things have already changed and probably won’t go back. For the real estate industry, there is a bit of a new normal, but it’s just a bit of a twist on the old normal.
The Impact Coronavirus has on Home Closings
The most glaring difference seen with home closings currently is how they are happening. No longer are buyers sitting at a table with multiple people to sign closing documents in person.
Some title companies began implementing drive-thru closings and others have switched to e-closings. Not only is this change helping to make closing on a new home safer, but it’s also more convenient and easier.
How Home Prices are Changing
While an upward shift in home prices has been seen in some areas, many believe this will be short-lived. It’s expected that home prices will come down as the market goes from a strong seller’s market to a buyer’s market.
The National Association of Realtors has estimated there will be a 10% reduction in home sales for 2020. If this is the case, home prices will likely fall as inventory will be lower and the market will shift towards the buyer.
What will be on the Market Moving Forward?
It’s difficult to predict the type of homes most likely to hit the market as the coronavirus continues to wreak havoc on the economy. However, it’s like the market will feature more homes, at lower prices, giving buyers more options than they had before this happened.
With many Americans unemployed and many small businesses shut down, maybe for good, it’s likely more sellers will enter the market with a bit of desperation. Some might be selling to avoid foreclosure in the future and downsizing may become part of the new normal for the real estate market.
There are so many moving parts within the market and some of these things we have never seen before. Right now, it’s hard to completely predict what will happen. However, it’s likely the new normal for the real estate industry will include more electronic closings, fewer open houses (unless held virtually), and only the most qualified buyers getting an opportunity for a showing.
As things start to cool down and restrictions are lifted, there may be more inventory than buyers, depending on the price point of course. Sellers could end up a bit desperate to sell, which may help drive home prices down.
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