The outbreak of the coronavirus has caused a lot of changes in our life. Everything is going through a temporary or even a permanent change. This means that the world is less certain of what the future holds. With all this, North Logan rental property owners are starting to wonder how COVID-19 will change the real estate market and how those changes will affect them.
Based on current economic indicators, it’s safe to say that changes are on the way. But there’s no need to fret as not all changes are bad. Market data shows that home prices are still rising, if very slowly. Growth in the first part of 2020 was less than 1% but has been improving since. Slower home price growth may be good news for you if you are ready to buy another rental property but may slow the appreciation of your property values on existing properties. Still, you can’t discount the fact that home prices continue to grow as the real estate market proves to be resilient in extraordinary times.
Property owners are afraid that a housing market crash similar to the one in 2008 will happen. Current high unemployment rates seem to foreshadow many foreclosures as people stop paying their mortgages. However, most experts don’t expect a real estate market crash. On the other hand, most experts agree that property equity is likely to decrease as buyers continue to show interest in existing and new homes.
The multiple reductions in the mortgage interest rate are yet an additional unexpected change this year. To prevent a housing market crash, the Federal Reserve has slashed mortgage interest rates to historic lows. For North Logan rental property owners, low rates present a host of opportunities. You can refinance existing loans to lower your monthly payment or borrow for your next property at very favorable rates. With these low rates, there has been a mad dash to secure financing. A lot of lenders are overwhelmed by demand and some are even tightening their lending criteria. Expect longer turnaround times from inspection to appraisals as high demand continues. Be patient, get a lender on board, and enjoy the current rates.
Doing this is important because even when a housing market crash is not on the horizon, another recession is almost certain. Stimulus funds from the federal government may have delayed the worst, but it is still just a temporary fix. As conditions worsen and the extent of the coronavirus outbreak is still unknown, experts aren’t able to predict the impact of COVID-19 on the real estate market next year. Most real estate professionals are turning to digital technologies to adapt to pandemic conditions. With virtual sales, online property tours, and Zoom consultations in their arsenal, real estate brokers, mortgage lenders, and property managers are using new tools to keep the market moving forward.
These new tools may now be the new normal for the real estate market, resulting in efficiency and energy in real estate investing. For North Logan rental property investors, it is vital to stay abreast of leads or opportunities to streamline and modernize both your investing and your property management process. Contact us today for help on how to do so, so you successfully make it through whatever the future may bring.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.