Since it originated in the city of Wuhan (China), the novel Coronavirus has gone on to penetrate nearly every country in the world, afflicting hundreds of thousands of individuals in the process.
As our luck would have it, the United States is currently the epicenter of the pandemic with over half a million cases. The state of Indiana falls somewhere in the middle with over eight thousand cases registered. This is relatively low compared to other states such as New York where nearly 200,000 individuals have tested positive for the virus. Today, Governor Holcomb and Indiana State Health Commissioner Dr. Kristina Box announced that they expect the surge in coronavirus cases to peek in the last week of April or first two weeks of May.
Given how businesses have had to shutdown throughout the country, the effects of the virus have been nothing short of devastating and every industry including the real estate market is starting to feel its impact. In this article, I will discuss the impact of Coronavirus in terms of the real estate market in Indianapolis and the rest of the country.
The Impact of Coronavirus on the US Real Estate Market
The first week of March reflected a strong buying season in the US real estate market. Flash forward 3 weeks later, and we are starting to see the impact of the Coronavirus on the housing market. To begin with, there has been a steady decline in the number of new listings. This can be attributed to the Reserve Bank cutting mortgage rates. As a result, sellers are forced to rethink about listing their homes.
There are a variety of reasons that are influencing buying or selling decisions in the US real estate market, as well. These include:
- Dropping mortgage rates (34.1%)
- Fear of recession (25.2%)
- Stock market instability (24.1%)
- Concerns about getting infected (8.6%)
- Concerns about career and source of income (8%)
As a result of these perceptions, here are some of the key changes witnessed in the US real estate market recently:
- Compared to last year, the number of homes available for sale reduced by 15.7%
- The national median listing price increased by 3.8 percent
- Compared to previous months, listing prices grew at a very slow pace in March
Given the looming economic crisis and the risks associated with it, sellers who are willing to list their property are looking for higher returns on their investment. This is also why the national median listing price has increased.
The market is positive for buyers, as well. However, a buyer must ask themselves whether they should consider investing in real estate at this point or wait for the economy to stabilize again. After all, buying a house is no laughing matter and one must weigh the pros and cons of this investment before making a decision.
If you have a secure job, then you can take advantage of the current market. If you are a homeowner, then this is an excellent time to consider refinancing your home loan and benefit from the current mortgage rate.
Now that you understand how the Coronavirus pandemic is impacting the US housing market as a whole, let’s take a look at how it can affect the real estate market in Indianapolis
The Impact Of Coronavirus On The Real Estate Market In Indianapolis
The real estate market in Indianapolis is doing fairly well with the number of pending listings ranging between 1,500 to 4,500 homes. The pace has slowed a little as compared to what you would expect for this period, but the housing market is still relatively stable in Indianapolis.
Some of the key changes witnessed in the Indianapolis real estate market include:
- Compared to last year, the number of active listings declined by 30.4%
- The median listing price is $299,950. It increased by 12.6% on a year-on-year basis
- The average number of days a listing is staying on the market is 48
- Sellers reduced their original listing prices by an average of 15.4% to entice buyers
These insights indicate that the current real estate market can benefit both buyers and sellers. If you are a buyer, then I strongly recommend that you view the situation objectively and prepare to buy a home. Instead of being fearful about what’s about to come, you must take this opportunity and do your due diligence regarding investing in real estate. You can approach a bank to get approval for a mortgage and reach out to a real estate professional in the area.
Thanks to digital technology, you do not have to worry about venturing outside to survey an endless array of homes until you find the right one. Instead, you can ask your real estate agent to give you a virtual tour of the property and make a decision.
If you are a seller, then I suggest you stop worrying about the impact of Coronavirus and list your home. Given how the median listing price has increased, you can still make a sale and generate a sufficiently high return on your investment. Additionally, given how there are fewer listings available, you do not need to worry about reducing your asking price by a great margin in order to entice a buyer.
There is no denying that the COVID-19 pandemic has delivered a heavy blow to the US economy. However, compared to other industries, the residential real estate market is still relatively stable. Whether you are a buyer or a seller, I suggest you carefully take this opportunity into consideration and make a decision accordingly.
Get In Touch With Barbie King to Learn More
If you want to learn more about the real estate market in Indianapolis, then get in touch with me. I am a real estate agent associated with Modglin Group Brokerage. Whether you are a buyer, seller, or investor interested in the real estate market, I am ideally positioned to assist you and can help you make the right choice for you and your family.