Every day I get emails where users ask me how the economy will be, last week from California they wrote me: what will the real estate market look like after the coronavirus?
I will try to reply through my experience and the help of data that I analyze to measure market sentiment. In the US and around the world the real estate market is locked, real estate agents can not let clients visit homes so those who want to buy have to wait until the end of the “lockdown”, some realtor are using technology like Virtual Tour 3D or social network like Facebook or Instagram to improve the conditions.
I do not have the crystal ball to know how many months we can resume our daily life but I am sure that coronavirus will infect house market, the reasons are simple if people have no money to buy houses the prices will fall. Same situation for offices where large companies pay high rents especially in the most important cities in the world where returns have fallen by 4%. Given the limitations that are there now and over time, we will have to adopt new habits. The question is, why does a company have to pay rent when its employees can work from home?
The coronavirus will also have a significant impact on the remodulation of sharing spaces’s concept, perhaps managers will choose the formula of the daily rent’s meeting room saving on the rent, it will be more a meeting place than a desk working .
Remember the subprime mortgage crisis in 2008? The prices of the real estate market plummeted, of course the scenario was completely different but the movie is always the same, if so many companies will close or reduce salaries how will you pay the rent or mortgage?
I think that the prices of the real estate market will fall on a global scale, it will be years before the post-coronavirus situation is stabilized. Short rentals on platforms like Airbnb etc… have suffered an 80% drop in bookings, it is clear that tourism is going through a difficult time, it makes me think that people will travel less and rent prices will have a negative trend.
Believe me when I said that real estate market has been infected with the virus, because it will also change the way you buy a house, the richest will prefer large and comfortable environments, those who will have economic difficulties will have to settle or will return to rural areas where prices are lower than in cities.
Who will pass coronavirus moment without any problems?
Large spaces like warehouses, because people will buy more on the internet so companies will need proper facilities to place goods and automate like Amazon-style order shipments.
Evaluate well before buying or selling a property, maybe it’s time to wait a little bit.