Buying a house in the middle of an unstable economy can be a tedious procedure. Housing prices tend to deflate during recessions and they usually rebound slowly. This year, the spread of COVID-19 has created a lot of uncertainty in the housing and finance markets.
Some recent issues faced by buyers due to COVID-19 pandemic
Similar to the economy, the housing market functions on the supply and demand. The usual spring boom of the housing market saw different light in 2020 as the pandemic hit and there were fewer houses listed for sale, more delisting occurred, and an overall slowdown in demand as the governments issued containment and social distancing orders. As the lockdown restrictions are relaxing the real estate across the USA is heating up. This is renewed by growing demand for housing but at the same time there is insufficient supply.
Options to continue the process of buying a house
Understandably, it is a seller’s market. However, with the help of the mortgage professionals at Rex Homes, here are some options you can look at to continue the process of buying a house:
- Analyze the market conditions: You can manage the uncertainty caused by COVID-19 by looking at a long-term view of the situation, and focusing on things you can control. This can help you avoid taking decisions out of panic. The interest rates are low and banks have cash to lend to borrowers with credit. You can understand the impact of mortgage rates by assessing your financials and taking help from a mortgage professional to help you analyze the situation.
There is an increased volatility with the average 30-year, fixed mortgage rate declining sharply. These low rates are creating a demand for lender services at a time when businesses are closing. This is also leading to issues for buyers such as extension in their closing timelines and freeze on their transactions.
Housing market is location specific since each location all over the USA was affected by the pandemic differently and at different times. The housing market may seem dissonant as everyone relates to the great recession but it should be understood that housing itself was the problem during the recession as people lost their homes. This was due to too much credit and people received mortgages they could not afford. In the COVID-19 pandemic credit is much tighter so, people who own and buy homes are likely going to be able to afford it.
- Look out for Deals: Economic crisis can offer investment opportunities for those who have the capital. Since real estate tends to become slow in uncertain times, sellers are more open to negotiations. Today the mortgage rates are at a record low so while it may look stressful this may be a good time to invest in a new home.
How can a Mortgage Professional help you?
The future of the economy is unpredictable and economists are divided on their opinion to when the economy will bounce back. A licensed mortgage professional can provide you with the latest expert advice to help you find the best house that suits you and pay the best price for it. Trying to navigate through the COVID-19 restrictions and safety regulations can be separately overwhelming. Mortgage professionals can handle all the procedures related to buying and selling virtually by offering services such as escrow, mortgage, insurance services, and even maintenance and repairs whenever possible.