Today is April 15th which means that Toronto has been under quarantine for the last 30 days. This also means that the world continues to deal with this global pandemic, also known as COVID-19. As a realtor, I continue to receive countless messages and phones calls with worries and questions. Like many others, I continue to observe how Covid-19 is impacting our real estate market.
To fully analyze the effects of the market due to Covid-19, we would need to consider data from a couple months before. Considering how long the process can sometimes be, transactions that closed in March, could date back to December-February.
To gain more perspectives on the possibilities, we must consider:
- Are buyers willing to buy and gamble during unprecedented times?
- How motivated will sellers be? Will sellers be forced to sell to obtain capital?
- How many investment properties will appear on the market now? Will people with more than 1 home decide to sell?
- Do homeowners have savings to support themselves through what has happened/ is to come?
- Do tenants have the savings to support themselves through what has happened/ is to come?
- Relationship between landlord and tenant and how it will pan out with the new legislations enforced through provincial and federal governments.
Though buying and selling during this time can feel like a gamble, the possibilities of prosperity also exist.
Below I have outlined some different scenarios for perspectives.
Here is an example of Buyer Benefit:
This is someone who buys at the current low interest rate, just before the pandemic ends. It is possible they buy at a negotiated price, get the low interest before it shoots up again, and purchase the property just before the market goes back up again.
Here is an example of Seller Benefit:
Seller decides to sell now, and then in the upcoming weeks (hopefully not) the pandemic worsens and home prices go down. The seller sold their home before the market went down.
Questions to ask if you are looking to buy:
• Have you been pre-approved?
• Can you work from home?
• Is your work listed as “Essential” (if you need to be mobile for work)
• Banks are triple checking employment, God forbid you purchase something, put a deposit, and tomorrow you job is not labeled as essential anymore. They are checking at pre approval time and before closing more than ever.
If YOU ARE LOOKING TO SELL:
• Are you selling more because you need or want to?
• Are you prepared to possibly sell your home below than what market value was a month or two ago?
• How comfortable are you with people coming to see your home? Or are you going to try to sell virtually?
• Do you see yourself needing capital in the upcoming months due to a low amount of recent business? If so, should you list sooner rather than later?
We are living in a time of “what if”. Because of the uncertainty that comes with that, my main role in my job is to guide and support you along the way. This means having the latest government information available and market data analytics on hand, so that you can be well informed and set up for success, while making the best decisions for you and your family. I hope this gives you some answers, some comfort, or some good perspectives to consider. For every closed door, a new one opens. I hope we can all find the good in this global pandemic.
As always, I am here to be of service. If you have any questions about buying or selling or just want to talk about the market during this time, please reach out. You can message me directly on instagram/ facebook or call me at (416) 616-7991.