COVID-19 cases are increasing, mortgage rates are at historic lows and for sale inventory continues to be down. Could the market’s uncertainty about the economic impact of COVID -19 spell opportunity for those looking to buy, sell or hold their real estate assets? Below we explore advantages for each scenario.
Buy | As of March 16th, mortgage rates have dropped to 50-year lows, representing short-and long-term savings advantage to those looking to purchase a home. Qualified buyers who are able to move quickly when a home comes on the market will be in a position to benefit from the savings these low mortgage rates will provide.
Sell | Selling your home now remains an area of opportunity for homeowners as many areas across the nation continue to experience a supply gap. According to MLS data, the Denver Metro market saw median sales prices up 7.10% compared to February 2019 and supply is down 11.50% compared to February 2019. A monthly report issued by Denver Metro Association of Realtors maintained that real estate is staying strong in the Denver Metro market. Additional data to support the strength of the Denver real estate market, in particular, comes from Jill Schafer, Chair of the DMAR Market Trends Committee and Metro Denver REALTOR who indicated that “Homebuyers and sellers leaped into action and took full advantage of the extra day in February. We shifted 7.08 percent more homes into a pending status and closed 3.16 percent more deals than in January.”
Schafer went on to say that “New listings moved into pending status faster than presidential candidates dropped out. The talk between agents sounds like more multiple-offer situations were occurring than a few months ago. Fewer homes to choose from pushes prices up in a community that already has an affordability issue so now is the time to get homes listed and on the market.”
Similar to many other markets nationally, areas with higher demand and reduced supply presents an advantage to the seller by way of an increased pool of buyers and higher sales prices.
Hold | A March 7th MarketWatch article suggests that to maximize the benefit of refinancing your home, waiting to do so isn’t the best strategy. Not knowing how long rates will be at historic lows coupled with the steady increase applications flooding into lenders are strong reasons to act without delay if you are considering refinancing.
Real estate, for now, continues to hold strong. It is possible that the real estate market may even remain insulated from some of the COVID-19 dynamics that are changing other sectors of the economic landscape, daily.
Buying, selling or refinancing a home is a major decision. If you have questions about buying or selling real estate, give me a call. I’m here to help you navigate the real estate market and the changes that affect it.