How COVID Has Changed the Way We Buy and Sell Homes
It’s safe to say that Covid-19 has changed the way we do most things around the world. From traveling to socializing and even simple trips to the grocery store, the pandemic has impacted most industries, including real estate.
Buying and selling homes is an inherently social activity, and when the season is in full swing, it’s not uncommon to view dozens of houses, or meet and interact with dozens of people in the same day, whether you’re viewing a house or trying to sell one. Obviously, the pandemic has made this difficult, but it’s also changed prices, what our priorities are, and even what we consider an ideal location.
- The Buying and Selling Process Is Largely Remote
Perhaps most notably, the process of buying and selling has completely changed in some ways. The traditional open house that used to attract numerous potential buyers per day is no more. Not only is in-person interaction and home viewing only allowed while wearing masks and with a signed weaver, the number of people allowed to be present inside the same space at a given time has been greatly reduced.
Where before, you would have viewed a home with a partner and your real estate agent, now one might have solo viewings discussed with the realtor outside, or even entirely online. Thousands of buyers have closed the deal remotely based on Zoom tours, without ever having seen their house in person.
Not only that, but even other crucial aspects of the process such as inspection and appraisal may be done without the buyer present, or just as a drive-by. Unfortunately, personal safety measures mean that some of these processes may not be as thorough, so buyers are taking somewhat of a risk.
- It’s A Seller’s Market
With fears of the recession looming, many thought 2020-2021 would bring a catastrophic crash for real estate similar to 2008-2009. However, it’s been the complete opposite. Real estate is a seller’s market right now, with homes going for asking price or even above asking, depending on the area and the features it offers.
Encouraged by a variety of factors related to the pandemic, from lack of space to fear of rising prices, people are ready to buy, but the number of homes for sale has shrunk. That means that sellers are at an even greater advantage to position their properties in a desirable way.
Houses are selling well, and they’re selling fast, with some properties going within minutes of being put on the market. If you’ve got a home to sell, now is the time to seize the moment.
- Buyers Are Looking for More Space
Unsurprisingly, our collective idea of what the ideal home looks like has also changed. With everyone being at home all the time, and even working and studying at home, a house can get very crowded, very fast. Buyers are looking for more space. A lot are searching for at least one extra room to use as a home office, if not several rooms if they’re planning on bringing in family to shelter in place together.
3-bedroom homes and 4-bedroom homes are hot on the market right now, and sellers are pricing them accordingly, so buyers who want more space in the middle of the pandemic have to be ready to pay for the luxury.
This is likely to be a long-term trend, as more and more employees are switching to permanently remote positions. Wanting an office, a study room, or extra bedrooms may become a requirement for more and more buyers, even beyond 2020-2021.
- Cities Are Left Behind for The Suburbs
Along with more space, buyers also want a greater distance from neighbors, from crowds, and from other people, in general. Not to mention the desire for some outdoor space that is safe and reasonably isolated. And you don’t get that with city living. The mass exodus cities have seen in 2020 is historical, with most of those people heading towards the suburbs in search of a safer location and a bigger home.
That has had the expected effect: city prices are going down, for the first time in many years, while suburban homes are being priced higher as they’re hot on the market. The more yard space, the better – and the more expensive.
In addition, the aforementioned switch to remote work means that more people are afforded the luxury of living in more remote locations. With no obligatory commute and the internet making remote learning, shopping, and socializing possible, living hours away from the nearest city is completely achievable – not to mention affordable.
- Technology Access Sells Big
Seeing as many office workers have switched to remote working due to COVID, it’s not only office space they’re after. Buyers are willing to pay more for stable, reliable internet access, because they depend on it. Sellers have picked up on that and homes in areas with good coverage, like Indianapolis, are surging in price.
A smart home will attract more buyers and a higher price tag, so sellers are including features like smart doorbells, smart speakers, smart thermostats – anything that can make being at home easier, more comfortable, and more convenient.
While the pandemic and resulting economic recession has not made housing crash fears come true, it doesn’t mean it hasn’t impacted the real estate market. The way we sell and buy homes has changed, albeit not fundamentally.
Buyers are eager for more space and more distance from crowds, so they’re retreating to the roomier homes of the suburbs – and they’re willing to pay the full asking price for it. The only thing standing in their way is the buying process that is largely happening remotely. More and more, people are buying homes they’ve never even seen in person and relying entirely on the video tours and photos they’ve been able to see online.
While right now, this seems like the only solution to a widespread problem, time will tell if buyers will regret rushing this decision or making it sight unseen.
- Guest Contributor, Emil Miller
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