The year 2020 began as usual but little did we know that COVID-19 would hit us like a thunderbolt. Pretty much all aspects of our day-to-day routines were directly or indirectly impacted by the pandemic.
Like every other market, the real estate market also took a toll. Purchasers and vendors on the Homefront were seriously affected by the unexpected lockdown and pandemic occasions. Many people escaped enormous urban areas and began moving to suburbs, hence increasing the demand for properties in those areas.
With lockdowns happening and everyone at home, families began battling with lesser space and craved bigger homes. The landowners were struggling for rent from the tenants, who were jobless because of the pandemic. This unleashed a great deal of damage on the real estate market all around the globe.
This article will discuss how this pandemic has affected the real estate market. Read between the lines to know more.
ISSUES IN THE REAL ESTATE MARKETS
After the lockdown, as everything became routine and jobs returned across the US, individuals began to lease and purchase more grand houses. This has come down on the generally aggressive market.
This lodging lack can proceed for quite a long time before self-correcting, a few market specialists have predicted. As there was no construction and a labor shortage during the pandemic, the construction costs likewise took off, impacting the market direly.
THE ‘WORK FROM HOME” FACTOR
With more organizations embracing a work-from-home culture, enormous urban communities have moved to the rural regions. For this, the specialists have also anticipated an ascent in this migration in the future, like New Yorkers moving to Kensington. There can be a steep rise in the demand for single-family homes in those areas.
PREVENTIVE MEASURES BY THE FEDERAL GOVERNMENT
With the National government giving stimulus for economic recovery due to COVID-19, the market has started to bounce back to normalcy. This funding has helped the tenants and the landowners, and they would now pay leases, contracts, and different costs. Direct financing to small businesses and landowners has once again opened up the possibilities of investments in the real estate markets.
THE PANDEMIC AND AFFORDABLE HOUSING
By definition, affordable housing implies the property’s cost isn’t over 30% of the family’s total income. As per The Washington Post, rents have increased 8.6% in 2021, and this pattern will proceed for quite a while. The US News announced that there might be a shortage of 6.8 million rental properties in the US.
WHERE TO INVEST?
The e-commerce business thrived consistently in the lockdown as individuals didn’t incline toward conventional physical stores. Thus, there was an expansion of sought-after distribution center spaces for storing the goods. As per a gauge by millionacres.com, around 330 million square feet of the room would be required for storing goods for online orders by 2025.
In this way, the industrial and distribution properties have the best investment possibilities by having such potential. Single-family housing has additionally brought huge investment possibilities as an ever-increasing number of individuals of the same demographics are moving to rural areas and demanding single-family houses.
HOUSING MARKETS TO WATCH
Raleigh and Austin are the two most housing markets to watch in the USA. Houses recorded available for sale in Raleigh were available for a mere four days as per this year’s data.
Then again, Austin is showing an increment of 42% for the houses than last year. This demand in these areas is fueled by the easy availability of loans and work from home culture.
THE BOTTOM LINE
Coronavirus has brought some uncommon and remarkable changes to the Real estate market. Investment possibilities have changed as the market obliges changes due to the pandemic.
But, presently, as the economy keeps on recuperating, the real estate market has shifted its direction and is indeed drawing in investors. So, this article was a little attempt to make you aware of the changes in the real estate market due to the pandemic, and I hope it helped.