Coronavirus and Real Estate, What You should Know

In Uncategorized by stefanLeave a Comment

Coronavirus and real estate? Yes. There will be a cause and effect — though it’s real impact remains to be seen and will likely take several weeks, if not months, to fully manifest. The fact of the matter is, as the economy changes and responds to the shift in buying and selling activity, there will most certainly be a measurable impact. Read on to learn more about the possible outcomes the coronavirus might have on the real estate market.

The Coronavirus and Real Estate Correlation

Whenever there’s a disruption in everyday market activity, be it on Wall Street or Main Street USA, the real estate market responds in a variety of ways. For instance, as interest rates fell over the course of the past several months, buying demand increased substantially.

The real estate market was dealing with its own challenges heading into 2020 – including affordability and limited inventory – but there are concerns the coronavirus crisis may deal a heavy blow to the sector. In March, preliminary data showed the situation has begun to negatively affect both buyer and seller behavior – though not yet to a serious extent. https://www.foxbusiness.com/real-estate/coronavirus-crisis-us-real-estate-market

In recent weeks, before the real threat of the coronavirus was known, interest rates were already near historic lows. With the emergency response of the Federal Reserve slashing its rates down to zero, commercial lenders have nearly unfettered access to capital. That might or might not trickle down to borrowers seeking to buy real property.

What You Should Know about the Coronavirus and Real Estate

The real estate market has long enjoyed and demonstrated a healthy track record. Even in periods where real estate prices have fallen substantially, it remains one of the safest and most reliable sources of investment.

Recently, the National Association of Realtors surveyed over 70,000 professionals in the industry. Of those, approximately 78 percent reported their situation had not changed with their buying clients’ intentions. Only 13 percent reported that buyers did have a change of interest.

In other words, as the situation unfolds, and interest rates continue to either drop or stay at record low levels, buyers and sellers alike are seizing the opportunity. This is likely due to the fact that most people prefer to carry on with their long term plans despite the short term circumstances.

How the coronavirus will specifically impact the commercial real estate market is not yet known. Although, in the short term, particularly over the next few to many weeks and and the next three or so months, there will most likely be a significant upset. However, recovery will also be just as substantial, returning the market to its previous health.

If you’d like to learn more about commercial real estate, please https://www.dieselcommercialgroup.com/contact We have years of experience in commercial real property and can help answer any questions you might need answered.

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