As the world contends with the coronavirus outbreak, multiple aspects of life have shifted. Plenty of these changes may be temporary, though it’s highly possible that others may last quite a while. The future seems less certain than it used to be. As a result, it’s not uncommon for Rigby rental property owners to speculate on how COVID-19 is changing the real estate market and how those changes may affect you.
As per current economic indicators, it’s safe to say that changes are on the way. However, that does not suggest that all of the changes will be bad ones. Market data shows that home prices are still rising if merely bit by bit. Growth in the first part of 2020 was less than 1%, but that has certainly improved since then. Slower home price growth can be good news for you if you are planning and able to buy another rental property but it can surely slow the appreciation of your property values on existing properties. Having said that, the fact that home prices continue to grow is a wonderful sign that the real estate market continues to be resilient in the face of extraordinary circumstances.
This is particularly relevant for the reason that numerous property owners are uneasy about another housing market crash similar to the one we experienced in 2008 – and for a good reason. With such high unemployment rates nowadays, it appears that it’s hard to avoid another big wave of foreclosures as people stop paying their mortgages. Even though most experts do not see another real estate market crash coming, most agree that property equity may decrease as buyers nationwide continueto show interest in both existing and new homes.
One other unexpected change this year has been multiple reductions in mortgage interest rates. As a means to prevent a housing market crash, the Federal Reserve has slashed mortgage interest rates to historic lows. Being a Rigby rental property owner, such low rates present several opportunities. These can range from refinancing existing loans to lowering your monthly payment to borrowing for your next property at very favorable rates. Definitely, the low rates have resulted in something of a mad dash to secure financing, several lenders are either overwhelmed by demand or tightening their lending criteria – or both. High demand has likewise created longer turnaround times for some parts of the purchase process, from inspections to appraisals. On the other hand, so long as you are patient and have a lender on board, you should easily be able to take advantage of current rates.
Doing just that is primarily crucial because while a housing market crash may not be expected, experts predict that another recession is almost certain. While stimulus funds from the federal government have helped delay the worst of it, such a fix is temporary at best. As conditions worsen, and with the trajectory of the coronavirus outbreak still unknown, industry experts don’t know how COVID-19 will affect the real estate market next year. Most real estate professionals are adapting to pandemic conditions by using digital technologies in new and smart approaches. With virtual sales, online property tours, and Zoom consultations in their arsenal, real estate brokers, mortgage lenders, and property managers are applying new tools to keep the market moving forward.
It may indeed be that these new tools become the new normal of the real estate market, leading to further efficiency and energy in the business of real estate investing. For Rigby rental property investors, it’s essential to stay vigilant for opportunities to streamline and modernize both your investing and your property management process. Contact us today if you are seeking help on how to do so, so you successfully make it through whatever the future may bring.
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