As the world contends with the coronavirus outbreak, countless elements or aspects of life have shifted. A few of these changes may be temporary, though others may last quite a while. The future seems less certain than it used to be. Therefore, it’s normal for Coopersburg rental property owners to think about how COVID-19 is changing the real estate market and how those changes may affect you.
On the basis of current economic indicators, it’s safe to say that changes are on the way. Although that does not specify that all of the changes will be bad ones. Market data shows that home prices are still rising even if gradually. Growth in the first part of 2020 was less than 1%, but as a matter of fact, that has improved since then. Slower home price growth could be good news for you if you are capable and ready to buy another rental property although it may slow the appreciation of your property values on existing properties. At the same time, the fact that home prices continue to grow is a superb sign that the real estate market continues to be resilient in the face of extraordinary circumstances.
This is, in particular, essential since various property owners are anxious about another housing market crash the same as the one we experienced in 2008 – and for good reason. With such high unemployment rates at the moment, it appears hard to avoid another big wave of foreclosures as people stop paying their mortgages. However, most experts do not see another real estate market crash coming. Instead, most agree that property equity is inclined to decrease as buyers nationwide continue to show interest in both existing and new homes.
One other unexpected change this year has been multiple reductions in mortgage interest rates. In order to prevent a housing market crash, the Federal Reserve has slashed mortgage interest rates to historic lows. As a Coopersburg 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. Needless to say, the low rates have established something of a mad dash to secure financing, lots of lenders are either overwhelmed by demand or tightening their lending criteria – or both. High demand has, moreover, created longer turnaround times for multiple parts of the purchase process, from inspections to appraisals. Nevertheless, if you are patient and have a lender on board, you could be able to take advantage of current rates.
Doing that is critical 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. Countless real estate professionals are adapting to pandemic conditions by using digital technologies in new and imaginative or creative methods. With virtual sales, online property tours, and Zoom consultations in their arsenal, real estate brokers, mortgage lenders, and property managers are taking advantage of the latest tools to keep the market moving forward.
It could be that these new tools become the new normal of the real estate market, giving rise to further efficiency, and energy in the business of real estate investing. For Coopersburg rental property investors, it’s vital to stay vigilant for opportunities to streamline and modernize both your investing and your property management process. Contact us today if you want 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.
