Impact of Coronavirus Pandemic on Real Estate Prices

Impact of Coronavirus Pandemic on Real Estate Prices

The COVID-19 pandemic has already created a massive impact on the economy and financial markets around the world. Like many other industries, real estate is going through uncertain times as a result of this unprecedented health emergency. Many real estate property owners, investors, landlords, and potential home buyers are keen to understand the impact of coronavirus on property prices.

Noted Lake Murray real estate company Homesinchapinsc.com answers some of the most common questions related to the real estate market dynamics in the aftermath of COVID-19.

Are Property Prices Falling?

Though there have been plenty of apprehensions, there have not been any significant unusual developments in terms of property prices. In the short term, the outbreak of the pandemic certainly led to shifts in purchase conclusions. However, on a long-term basis, it will not reduce the demand for housing. Over the years, the scarce supply of real estate has resulted in high demand for living spaces in most cities and regions across America. Even in the current situation, this fundamental trend is not likely to change significantly. Property prices will not suffer a great deal at the moment because real estate continues to be an attractive option for investors.

Residential Real Estate Property Price

The residential real estate sector has experienced strong growth in recent years because of a rising population and the continuing influx into medium-sized cities and metropolitan regions. This high demand is yet to be met, even after a flurry of new construction activities. Even in the face of the corona crisis, this demand will not decrease because of the eternal necessity for people to have roofs over their heads.

Given the current market situation, any significant fall in property prices is not yet foreseeable. It appears that despite the corona crisis, the residential real estate will remain unaffected in terms of pricing. Honestly speaking, once again, real estate is proving to be a safe investment in difficult times.

Commercial Real Estate Property Price

As of now, the commercial sector is also behaving in a stable manner as a whole. However, the pandemic has affected certain individual sectors in varying degrees. It is true that the retail, catering, and hotel sectors are going through tough times right now. On the other hand, however, we could soon see a surge in demand for warehouses and storage spaces. In the days to come, we may see an increasing trend amongst manufacturing companies to create their own warehouses, boosting the market in the process.

Should the Buyers/Sellers Wait?

Naturally, in the current scenario, many potential property buyers and owners are uncertain about whether this is the right time for property investment. Honestly speaking, there is no economic factor to deter owners and investors from buying or selling a property because the market situation has remained largely unchanged until now. Moreover, there have been no noticeable changes in terms of interest rates.

By contrast, the market for office properties is likely to face a temporary downturn. For the time being, it is possible that there will be fewer rental agreements for office properties, particularly the long term ones.

What About the Numbers?

The fact the current market has a lower number of real estate transactions to show can be attributed to the prolonged lockdown and curfews imposed in different parts of the nation. Property visits maintaining stringent social distancing norms have been extremely difficult under this scenario. Also, obtaining a loan has been difficult for investors because of prolonged bank closures. However, the good thing about the present scenario is that there are plenty of postponements, but not a lot of cancellations. refore, once the COVID-19 situation is under control, the market will definitely pick up in terms of numbers and we may even see serious catch-up effects.