The economic implications of the coronavirus are likely to be widespread, and devastating.
Not long recovered from the crash of 2008, the housing market is again facing a huge challenge. Those of you with investment interests in property, or who are thinking of buying or selling a house, will be particularly interested in this aspect of the coronavirus story.
Read on as we look at the likely impact of the coronavirus on the housing market.
The Current State of the Housing Market
Before the onset of the pandemic, America's housing market was suffering from a chronic lack of supply.
Across the country, demand for homes exceeded available units. This situation was at its most extreme in hubs of industry like Seattle and the Bay Area, and San Diego certainly experienced this as well.
While this was not an ideal situation, it was a symptom of a flourishing economy. The virus is likely to greatly inhibit economic growth, which will inevitably have knock-on effects for property.
Likely Effects for Home Buyers
Prospective homebuyers who are confident that their income will remain consistent throughout this crisis now find themselves in a good position.
The market is likely to weaken as a result of the coronavirus, lowering property prices and benefiting some buyers.
As well as this, interest rates are low and are likely to remain so for the foreseeable future. Borrowing is therefore affordable.
However, the effect is less positive for those who have lost their jobs, or who are in danger of losing it. For those uncertain of their earning potential in the near future, buying a house may have to wait.
If you are in a position to buy, but are wary of spending too much time in public, use this time to do online research and take virtual tours of homes.
Likely Effects for Home Sellers
If you're interested in selling your home, you need to realize that the price you will currently be able to get for it may be lower than the price you would have gotten before the onset of the coronavirus crisis.
Because of this, many sellers will now wait before putting property on the market. This will hopefully allow for a more gradual decrease in prices generally.
If you need to sell your home soon, you may have to get creative in terms of how you market it.
Some sellers have recently been using technology to show prospective buyers their home. Apps like FaceTime can be used to give virtual tours.
Our team has recently begun to set up 3D virtual tours of clients' homes. See an example here.
If you do need to host physical viewings, make sure to uphold social distancing guidelines. Also, remember to stock up on hand sanitizer.
What Should I Do?
As you can see, there is no clear path for the housing market at this point.
The coronavirus will get worse before it gets better. Because this situation is unprecedented in modern times, there is simply no blueprint for likely outcomes.
If you're thinking of buying or selling a home in San Diego, contact us today to schedule a call.