These turbulent times have many homeowners wondering about the health of the real estate markets and the challenges facing homeowners during the business shutdowns.
Let’s keep it real. People are losing jobs. Small business owners are stressed to the max, and may have trouble making it to the “light at the end of the tunnel”. Concerns are not unfounded.
However, as many homeowners still look back on the dark times in 2008 with a great amount of trepidation, there is cause to see a silver lining.
Unlike 2008, 37% of homeowners own their homes outright (according to Forbes, citing data from Zillow). An additional 25% of the remaining homeowners have equity greater than 50%.
Unlike 2008, homeowners have not generally been using their home equity as an ATM.
Unlike 2008, banks have been very strict about who they will give loans to, requiring good credit and sufficient income to approve a loan. Loans are less risky and mortgage companies are not burdened with large portfolios of foreclosed homes – foreclosure rates are at an all time low, down 88% from 2010.
Unlike 2008, the government is taking more steps to protect homeowners from temporary loss of income, through increased unemployment benefits and moratoriums on foreclosures and evictions.
Unlike 2008, the fundamentals of the real estate markets are strong. The outside forces putting pressure on real estate are temporary, and homes are not over-valued.
According to Dr. Lawrence Yun, Chief Economist at the National Association of Realtors(R) and industry expert Brian Buffini, economic recovery is quickly taking shape in the countries that have gained control over the coronavirus spread, and housing will regain momentum in the late summer/early fall in the US. See the infographic below for more details.
The coronavirus, or COVID-19, has thrown us all into a bit of a tailspin. However, if you are thinking of buying or selling in 2020, all is not lost. There are still buyers in the market, especially in Northern Virginia, and sellers are still commanding strong list prices. The economy is expected to start recovering in the 3rd quarter, jobs will come back, and mortgage companies are expected to work with borrowers to help them keep their homes and survive this period of social distancing. This, too, shall pass.
Whether you are looking to buy or sell a home in Northern Virginia, we are always here to help with your real estate needs! Contact Jason at 703-298-7037 or Jason@JasonandBonnie.com for a free no-hassle consultation!