While the health of our family and friends is the top priority right now, there are many who are justifiably concerned with how the global pandemic is, and will continue to, impact the luxury real estate market. As one of the largest and most important assets in an individual’s portfolio, it’s necessary to understand how this crisis will affect the value of your home. While the situation is rapidly evolving, here are a few key takeaways to help keep you informed at this point in time.
Uncertainty Looms Large
As is currently the case with the financial markets, and the economy as a whole, uncertainty is the key word right now. There are those who forecast a quick economic bounce back and those who see a drawn out recovery, but the reality is that no one can say for sure because this crisis is unprecedented. For the time being, a wait-and-see approach is the safest way to go.
Short Term Implications
In the short term, it’s fair to assume that city markets will be the most impacted by the pandemic. There’s no denying that densely populated areas are at a higher risk for spreading the virus until the outbreak is under control and a vaccine is developed. For this reason, the activity that continues in the luxury sector across the country tends to be focused in rural, suburban or second-home markets, with high-end rentals being in particularly high demand in these locations. That being said, as buyer demand softens in urban markets, this could present unique long-term opportunities for those well positioned to acquire property.
Real Estate Goes Remote
While most state and local governments have deemed real estate an essential service and offices could theoretically remain open, the industry is largely equipped to conduct business remotely. Across the country, agents are harnessing technology to provide virtual tours, drone footage and 3D floor plans so that buyers who are looking to take advantage of historically low mortgage rates can make informed decisions without having to leave the safety of their home.