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Spring typically is the peak season for home buying, but this year’s Coronavirus scare has given us a particularly unpredictable market. As lockdown orders hit the economy, sellers took their homes off the market – either out of concern over people entering their homes or concern they wouldn’t be able to sell for their desired price. Buyers had their share of concerns, too, as millions lost jobs, were furloughed, or took pay cuts.
Despite all that, many economists still suggest this summer will be a good time to buy a home. Granted, some of these economists work in the real estate industry, and saying that is self-serving. But their reasoning contains some logic, so if you’re in the market for a new home, you may want to consider these points.
- First, this virus-induced recession is entirely different than the last one. The real estate industry drove the Great Recession a decade ago, and home prices declined dramatically in many markets. In this recession, it looks like real estate will remain relatively unscathed, which is what has happened in recent recessions other than the Great Recession.
- Second, as lockdown orders are lifted, it’s likely real estate markets will see a flurry of activity due to pent up demand, and we are starting to hear this from local realtors. It sounds likely you’re going to face the same competitive market we had last year. Homes that are priced correctly will sell quickly.
- Third, interest rates are at record lows, and I don’t expect they can get much lower. If you wait and rates rise, you may not be able to afford as much home.
If you need to buy a new home, keep in mind that sellers are just starting to come back into the market. Home choice may remain a little lean for a couple more weeks, but analysts are predicting a surge of listings this summer. Get a good real estate agent to help you identify homes as soon as they’re available and to help you keep from paying too much.