Real Estate Trends After The Pandemic
The Ever-Changing Real Estate Landscape
Real estate has, for many countless ages, been a reliable source of steady investment returns for those with the know-how regarding how social psychology and mass movement works. If you knew the trends in human thinking, you'd know where everyone had their eyes on; and thus where everyone was likely to go. Make an investment, seize the opportunity. Those who were able to see the value in a fledgling Manhattan island in the late 1800s were able to reap the rewards & then some, all due to foresight and an eye for public sentiment & trends.
That said, although real estate has long since been a field that would benefit those who had a knack for picking out behavioral trends amongst the public, there have nonetheless been periods of catastrophic events in which the real estate market was shaken to its core. The house prices trend within America saw a stark dip in activity and predictability after the 2008 Financial Crises conspired, for example. The housing market tanked afterward and people all over the country were wary of any kind of long-term real estate investments, being distrustful of the institutions that distributed them themselves.
Now, America (and indeed even the world) is at another crossroads for a catastrophic event; that being the onset of the Covid-19 pandemic. The Covid-19 pandemic, like many other significant events throughout history before it, has greatly damaged and impacted real estate market trends for nearly all in the developed parts of the world. And as such, that brings us to the subject matter of this very article. Within this article, we will seek to paint a clear picture of what exactly has transpired within the real estate market ever since the virus kicked off. So without further ado, let's dive into the ramifications that have come from the real estate industry during this hectic time period.
The Initial Impact of Covid-19 on The Market
Early within the year 2020, the entire world was struck and brought to a halt by the onset of the Covid-19 pandemic. Almost immediately after state officials began to acknowledge the problem, sweeping reforms began being passed that would gravely impact financial markets all over the world. Financial markets everywhere began to take hits as these reforms took effect, causing all-time lows in customer sentiment. This was due to the extensive lay-offs and stay-at-home restrictions, failure of retail businesses, and most crucially, surging deaths spiking all around the world.
Because of all of these chaotic factors, people began to greatly prioritize having money on hand rather than invested into an asset, causing many to pull their funds out of well-established markets. This didn't just lead to significant stock market sell-offs either, all markets were affected as people decided to enter a highly cautious state of mind, awaiting the outcome of the pandemic before spending any money on assets such as real estate. The number of commercial land transactions saw a stark decline between the end of 2019 & the middle of 2020 due to these factors.
The Full Brunt of The Pandemic Takes Effect
Once the Covid-19 pandemic started to hit in full waves of effect, we surprisingly started to see a resistant pushback from the real estate market. Many people expected prices to fall into the pits of hell once the full breadth of the virus was known (to which it was a large one, indeed). However, once the initial onset of the virus was known, market participants then "priced in" any largely catastrophic consequences immediately, which means that when the full brunt of the virus hit the market held steady.
As of the end of 2020, commercial real estate prices remained flat rather than declining.
The Light at The End of The Tunnel
The worst of the worst was priced in and it was hard to surprise the market. After the start of 2021, real estate began to dig itself out of the hole it was in. New listings have increased an unprecedented 36% compared to this time last year, which had a 7% increase or less. On top of this, median listing prices grew for the first time since last year, clocking in at a high 18.7 percent according to Forbes.
Along with the lifting of pandemic restrictions, the fueled buyer confidence. Citizens were now back buying & looking for homes, using platforms such as the National Property Buyers Brisbane. As of now, it seems like the market is back up & kicking.
So we've taken the chance to delve into the in-depth effects that the pandemic has had on the real estate market, discussing trends and patterns of behavior at length. We hope that this will help you in making an informed owner decision! Stay frosty.