Selling and buying during Covid 19 is it different?
Yes and no. Covid 19 has affected real estate buyers and sellers. The uncertainty of current and future real estate markets is clouding decision making and creating anxiety. However, real estate still needs to be transacted during a pandemic.
The difference in the ‘normal’ real estate market and the pandemic real estate market is not that great. The unknown always exists – no one ever knows what next year will do with certainty, or what areas will boom or remain stable. The constant is that real estate is a long term investment and few could argue there is a better asset class. Rather than worry about the pandemic always focus on meeting the current market.
To allay fear, I have outlined some points for both buyers and sellers that are constant regardless of external environments.
Buyers – FOMO is fear of missing out and FOOP is fear of over paying. To avoid this:
- determine the amenity value -transport, schools, shopping, recreation -these are state assets and never depreciate;
- consider the access to amenities the closer the better as these are highly desirable;
- create spread sheet for the property sales of the preceding year in suburbs you’re considering and compare like for like;
- only focus on suburbs you are interested in -often fear is because people are listening to media that reports on the whole state;
- remember long term investments ride rises and falls in markets -that seven year profile relates closely to performance and
- consider the land value rather than the house value -land near a city is always more expensive.
Sellers –marketing is addressing a target market by giving the market what they want.
- try and remove your personal feelings about the house – instead focus on what buyers want from your property;
- determine what is in demand in your area that buyers want and you have -schools, transport, recreation, village vibe etc;
- if there is a loss of equity on paper, remember you will likely recoup that on a purchase in the same market;
- consider not setting a price instead wait and listen to offers – some people will be ridiculous but most serious purchasers will bid in a normal range and
- consider the buyer variables to determine if you sell or stay. If the banks are lending less, employment is problematic or your property lacks what is highly desired you must either meet that market or wait till the external environment is less problematic.
You need to be confident and rational in your decision making as these are the keys to real estate success regardless of the market -or the environment. You can create demand for your property in any market by taking a much broader perspective. Remember every threat offers opportunity!
Brand and Marketing Manager