Over 25 million Americans have lost their jobs since mandatory “stay-at-home” orders were put into effect, with more predicted to file for unemployment in the coming weeks. Many people fear that this will cause a wave of foreclosures circa 2008 that will take down the housing market.
There’s no denying that the massive wave of job losses caused by COVID-19 isn’t serious, but economist believes that the effects won’t be for long. Mortgage companies have taken this unique situation into account, with many offering the option to defer payments for those who have been affected.
Plus, Americans are in a much better equity situation than they were in 2008, with 37% of homeowners having no mortgage at all. And looking at data from the last 30 years, there appears to be no direct correlation between unemployment rates and home sale rates. For example, unemployment rates have dropped significantly in the past 5 years while home sales have remained steady.
Should I Buy or Sell a Home Right Now?
All of the above questions ultimately lead to this one. Many Americans have halted their home search or selling plans because of the uncertainty surrounding everything going on right now.
While the COVID-19 pandemic has disrupted the way we do business, real estate as a whole has not stopped. Some markets have slowed while others are now heating up.
Every market is different. So, it’s up to you to combine local market insights with big-picture economic information to choose the best plan of action for your clients.
Sometimes clearing the air about a recession, home values and foreclosures can be enough to move a hesitant buyer or seller off the fence in a market that’s still seeing activity.