Given widespread concerns about COVID-19, high unemployment rates, changes in the stock market, and a COVID-19 vaccine many months away, it’s natural to wonder whether it’s wise to sell or buy a home now.
Despite the unique circumstances of our time, several positive themes have emerged for the real estate industry in local New Jersey communities. First, some sellers who had planned to market their homes before the March 2020 COVID-19 lockdown, still must do so because of job and life changes; and second, new buyers who want less-crowded living options have emerged as a result of the pandemic.
Motivated sellers can benefit now
from less competition,
new buyers entering the market for single-family homes,
and continued low-interest rates.
If you are a homeowner in Chatham, Madison, Summit, or a surrounding area, you are still well-positioned to sell your home. Many things about your investment, after all, have not changed despite COVID-19. For example, your home value is still supported by outstanding schools, safe and appealing neighborhoods, beautiful town centers, open spaces nearby, and midtown direct train service to New York City.
If you have owned your home since 2013 or longer, you also may benefit from significant appreciation in your real estate investment over the last seven years.
Our town centers and trains may remain quieter than usual for the time being, but many New York-based companies and professionals also have successfully adopted work-from-home policies that make suburban living more compelling than ever.
Given its many assets, the local real estate market is poised for success.
Ali Wolf, Chief Economist with Meyers Research, and Robert Dietz, Chief Economist with the National Association of Home Builders, suggest that housing will not suffer as hard an economic hit from COVID-19 as the hospitality, trade, transportation, and leisure industries. Mr. Dietz says the real estate market entered the COVID-19 lockdown with an under- rather than overbuilt housing sector — a characteristic that may bode well for housing sales/purchases once the economy turns around.1 Furthermore, historical analysis from the John Burns Real Estate Consulting Firm confirms that previous pandemics have not significantly affected home values.2
“…as the economy rebounds, which it will at some stage,” says Economist Dietz,
“housing is set to help lead the way out [of a recession].”
The good news is that each day, buyers who might otherwise have not entered the local real estate market contact me with requests to explore homes in our communities. Given positive factors that support home sales, sellers might want to enter the spring real estate market sooner rather than later to maximize their odds for success.
If you have concerns about the local real estate market, let’s talk. Although there is no way to predict the future, there are practical steps we can take to sell your home this spring. Virtual meetings, for example, allow us to discuss strategies for marketing and listing your home while keeping you safe. A video tour of your home will allow buyers to see its features without any extra trouble to you. Serious buyers who want to visit your home in person will be screened and instructed to strictly follow all current hygiene guidelines.
As an expert in the local real estate market,
I can answer your questions and provide valuable insights to help you successfully sell your home.
If you are considering selling your home this spring, follow these tips:
- Reach out to an experienced realtor/broker for answers about the local real estate market, including information about pricing, your competition, and potential buyers
- Clean, declutter, and make necessary repairs to your home inside and out
- Maximize online options for marketing your home with a well-written, thorough description, inviting images, and a video tour
- Allow in-person showings only to serious, prequalified home buyers
- Leave your home during showings to maximize safe distancing
and allow buyers a chance to feel at home
- Allow additional time for lenders, home inspectors, escrow agents,
and appraisers to respond and complete tasks needed for the sale
- Be flexible with the purchase agreement and closing
- Be prepared for unexpected changes, including having buyers back out of the deal
- Purchase contracts often now give buyers options when their financial circumstances change and they cannot get a loan
- Given low-interest rates, lenders are now protecting themselves and buyers
from unwanted loan defaults with stricter requirements, including large down payments (as high as 20 percent in some cases) and high FICO® credit scores (700 or higher)
There’s no denying that we are living through one of the most unique experiences of our lifetimes. While we are forced to make many changes in our routines, we have seen the benefits of safe distancing and recommended hygiene practices. We also are seeing creative business solutions that allow some industries to continue making progress despite obstacles.
I believe that local real estate can be among our successes during this difficult time. It will require a thoughtful, patient approach, a focus on safety and health, and willingness to persevere in the face of challenges. Drawing on my more than 20 years’ experience in the local real estate market, I can help you achieve these goals with facts, realistic expectations, and guidance throughout the process of selling your home.