The pandemic did a number on the world’s economy, sparing no industry or sector. Food supply is limited, logistics companies have to halt operations, and schools and offices suddenly have to shift to a work from home situation. Despite this, people are beginning to adjust to the ‘new normal’ and are slowly finding ways to emulate the ‘old days’. Some businesses are reopening, parks are accepting small groups of people, and restaurants are adjusting their layout to accommodate the new social distancing rule.
However, one industry is interestingly benefiting from and is experiencing quite a resurgence: the real estate market. But why is this the case and should you follow suit?
Why Are People Buying?
1. A House is Valuable
With everyone having to stay at home for months on end, many realized how valuable a house of your own is. One that you can change to suit your liking, and one that is ‘yours’. Our home is a safe place where we can feel comfortable, with all the comforts we need in our everyday life. It’s also a literal safe space since following the safety protocols include staying in your home and avoiding crowded areas.
2. Work and Study at Home
Many companies and schools are forced to switch to a work or study from home setup. Many have realized that they are sadly unequipped to do this efficiently. Small spaces make for noisier rooms, and if you’re sharing your house with your family members, it can be really difficult to focus. Large houses or houses with multiple rooms are becoming popular as more and more people look for ways to make working or studying from home more efficient.
3. The Price Drop
With many people are selling their businesses and properties in the second quarter of the year, real estate dropped by up to 54%. This is the largest decline in around 30 years and this favored buyers. Despite the economic slump, many people have taken advantage of the all-time low to purchase houses that suit their needs, and can we blame them? At times like these, owning your own home is definitely beneficial.
Should You Buy Now?
But the question still remains, should you buy a house now? It’s still a complicated question to answer. First of all, the pandemic did not reduce the interest rate of real estate to 0%, it’s just lower. This creates a false sense of relief that you can afford a house now. While you might be able to fund a mortgage loan for a house, ultimately, your financial plans in the next few years will dictate whether it’ll be difficult for you to maintain that.
Secondly, trends shouldn’t decide whether you should purchase something or not. Your buying powers are yours and yours alone. The decision of whether you should buy a house shouldn’t come from market trends or sudden discounts but from buyer readiness and commitment. Buying a house is still buying a house: it’s a major financial commitment that takes time.
In the end, the answer to this question lies with you: if you are financially capable to do so and have a reason to, by all means, buy now. If not, don’t let the appealing market rates fool you.