We may be in the midst of a global pandemic, but life goes on. No surprise, then, that we have clients who are selling, building, buying, and refinancing homes across the state, despite COVID-19.
Curious as to how Florida’s real estate market is weathering the pandemic? Here’s some highlights:
Transactions are continuing day by day. “The governor has declared real estate an essential service and transactions are still occurring across the state,” says 2020 Florida Realtors President Barry Grooms. Several local real estate attorneys and mortgage specialists have told us they’re getting transactions done, albeit with an extra dose of creativity to get documents prepared, approved and signed in a time of social distancing.
But transaction volume is lower than usual. The volume of real estate purchases and sales in the state has dropped, at least temporarily, in response to stay-at-home mandates and lockdowns. “Many buyers and sellers have understandably pressed the pause button due to the pandemic and the current climate of uncertainty,” reports Florida Realtors President Grooms. National housing expert Skylar Olsen, an economist at Zillow, sees signs of a real estate thaw, and predicts sales may start to pick up now that real estate professionals and homeowners have adapted to the reality of virtual showings and other logistical workarounds.
The long-term outlook is uncertain, but prices are expected to hold up. Housing prices aren’t expected to drop significantly due to the COVID-19 pandemic, says Chief Economist Brad O’Connor at Florida Realtors, since builders have been cautious since the last recession. They’ve built fewer homes, and Florida has a statewide housing shortage, he says. Sellers who haven’t yet been able to sell during the pandemic are pulling their houses off the market rather than cut prices. When the state’s economy opens back up, he says, they’ll put their homes back on the market and try again. What O’Connor doesn’t expect is an across the board reduction in selling prices. His view are echoed by national real estate experts. While the spring home-buying season has been derailed by COVID-19, homeowners may opt to delay and sell their homes later in the year, so Fall 2020 may become the new spring selling season.
The Takeaway. You may be thinking about relocating, like many of our clients. If you’re not picky about when you move, you may want to postpone selling your home until the real estate climate is better suited to open houses and home showings. It’s just easier.
One couple we advise has postponed their plans to retire and relocate to late 2020 or early 2021. Another local couple is building a new home in Northern Florida, with a closing scheduled for June. They had hoped to sell their South Florida home by then, but the pandemic got in the way. Now they’ll have to pay the expenses of both houses until the market picks up and they can sell the South Florida home.
If relocation is in your future, give your home extra time to sell, and map out your financial contingency plans if things don’t go as hoped. Most homeowners aren’t financially able to carry two homes for long, so make sure to discuss your plans with your financial advisor and work out the details before firming up your relocation plans. And of course, consult your real estate professional for questions on selling, pricing, and marketing your property. Their expertise can be invaluable at a time like this.
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