Posts

Buying Real Estate

Why Investors Are Continuing To Buy Real Estate During The Pandemic 

Investing in real estate property in the middle of a global pandemic and nationwide recession may seem like one of the worst financial decisions one could make, however, many are finding it to be quite the opposite. Real estate prices in major cities all across the country are dropping as many individuals have been fleeing the close, busy life of the city to return to their suburban homes while they wait out the rest of the pandemic. 

The market is extremely slow, the economy is weak, and property listings are going down, which is leading to a lot of buyers receiving amazing deals on homes and apartments they may have not been able to afford nine months ago. 

Embed from Getty Images

Specifically, if we look at New York City as an example, we know that this metropolitan is one of the most expensive markets in the country. In the second quarter of 2020, real estate sales in NYC unsurprisingly plummeted by 54%, which has been the largest decline in the market in 30 years. As a result, sellers have grown more desperate, which is placing many buyers in the position of power in terms of negotiations. 

The average sales price for properties in Manhattan has dropped 18% to $1 million when compared to 2019’s sales; the biggest sales decline in the past decade for NYC. In California, a state that’s relatively equal to New York in terms of real estate market, Orange County reported a 5.2% drop in pricing, and that number is expected to increase by another percent within the next year. 

Besides the market being more in favor of the buyer, people are beginning to become a lot more appreciative of the spaces they consider home. Now that we’ve all, for the most part, been quarantining or working remotely in our homes, many are beginning to realize they want a space that truly makes them feel safe, leading to even more sales. People are being inspired to invest in their property more and push their spending to match up with what they truly want. 

Embed from Getty Images

Along those same lines, for those of us working from home indefinitely, we’re beginning to realize that our homes now need to be divided to have an area dedicated to work, and the rest as our own personal work-free spaces. Separating your professional brain from your at-home brain has grown to be extremely difficult for many, which is obviously understandable considering home and work have taken over the same space. 

Working from the couch or your dining room table without an actual office space and environment can be really difficult for some, especially if you’re sharing that space with family or kids. Now, people are realizing that we really don’t know when life will return to normal, so they’re yet again choosing to invest in their property. 

Market-wise, upgrading your home for one that has even just one more bedroom has never been more feasible based on current trends. Hot tip: if you’re a buyer looking for a new space where you’ll also be working-from-home, a portion of your mortgage can be claimed on your taxes as a home-office deduction. Talk with your real estate agent about the specifics with your area and potential new mortgage as well.