Posted by
Sara Molina

Does COVID-19 affect real estate investing?

Some of my investors think its time to hold off. I have seen great deals and think its time to buy at a higher discount. Thoughts?

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Does COVID-19 affect real estate investing?

By Sara Molina   
Posted on Jul 07, 2020 in Topic: Realtor Only
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Some of my investors think its time to hold off. I have seen great deals and think its time to buy at a higher discount. Thoughts?
Status: Open
Viewed: 344
Asked by: REALTORS®
Posted: 1 month ago
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Bronze
Deanna Essmyer
about 1 month ago
Due to the economic impact of the Coronavirus, analysts predict a prospective rise in the number of foreclosures over the next several months. As such, as a real estate investor it’s wise to make sure you keep a close watch over changing trends in the distressed market. In this article, we explore how COVID-19 may impact foreclosures in the future and how you can ensure you stay alert to any changes in the market.

Coronavirus’ Impact on the Foreclosure Market
ATTOM’s Q1 2020 U.S. Foreclosure Market Report highlights that we saw 156,253 U.S. properties with a foreclosure filing in the first quarter of 2020. This is a 3% decrease from Q1 in 2019.

In addition, 46,800 U.S. properties were recorded with foreclosure filings in March 2020 – down 20% from March 2019 – the third consecutive month with a year-over-year decrease in filing activity in the U.S.



Source: Realtytrac (an ATTOM Data Solutions company)

In addition, while US Congress has temporarily enforced deferments on mortgage payments, many may struggle to keep up with mortgage payments in the future due to the hit to jobs and financial savings.

Moreover, while several banks are suspending foreclosure, it’s unclear how long the majority of these will last, since the majority of institutions have not provided a suspension time frame.

However, as an investor, you’re likely aware of the ongoing contraction of the market for many years before the Coronavirus hit. Our Year-End 2018 U.S. Foreclosure Market Report, highlighted that foreclosure filings were 78% from the 2.9 million heights of 2010.

The Future of the Foreclosure Market
Industry analysts predict that after an extensive period of contraction, the number of foreclosures is predicted to grow rapidly next year.

Our chief product officer Todd Teta notes that the number of foreclosures could also see a sharp rise over the coming months due to the greater unemployment rates and financial difficulties due to COVID19.

Recent reports show that unemployment


Source:


Atom Data Solutions

about 1 month ago
Diamond
Joe Applewhite
about 1 month ago
There's always variables and there are always good deals. I have clients that are taking advantage of these great deals. I also have clients that have forfeited earnest money because of the fear of losing their job. It just depends on what side of the fence you are on.


about 1 month ago
Bronze
Toni Vacker
about 1 month ago
yes I fact Galveston investors are making more money now because folks are unable to travel abroad or cruise.


about 1 month ago
Bronze
Tracey Richardson
about 1 month ago
Yes of course! Especially if the property is not vacant.


about 1 month ago
Bronze
Jesus Ramirez
about 1 month ago
Cash flow is what saves you from a recession. If the deal makes sense and meets your investment criteria, absolutely! Interest rates are low. In our case, we adjusted our vacancy to 20% instead of 10%. We are continuing to invest wisely. Hope everyone is staying safe!


about 1 month ago
Bronze
Shantel Landry
about 1 month ago
Absolutely, it changes the game for everyone. The uncertainty of taking a chance on a budget. Some job loss unable to maintain rent.


about 1 month ago
Bronze
Fareha Abbas
about 1 month ago
Interest rates are super low , and now market is different than 2008 when lender stoped to lending money to buyer .
Cash flow is what saves you from a recession. If the deal makes sense and meets your investment criteria, absolutely!


about 1 month ago
Bronze
Forreste Markowitz
about 1 month ago
I started investing in 2009 when the Great Recession was in full swing. It was easy to find flips and rental properties during this time. It was also pretty easy to sell them and rent them out too despite the economic downturn. This situation feels much different than the GR because there is much more unemployment and long term uncertainty about when this emergency will end. Nobody wants to get stuck with a flip that can't be sold or a rental property with a tenant who can't pay rent, especially if a mortgage must be paid. However, I have been keeping an eye on the foreclosure rate. If it starts to trend upward, this will provide an opportunity to find well priced properties. Regardless of how well priced or plentiful the properties may be, strict due diligence must be performed so that all risks are considered. Can you make your mortgage payments if a tenant is unable to pay rent? Are you willing to evict the tenant and if so, can you continue making payments until the process is completed and then wait for another tenant to move in? If you have used hard money to purchase a flip, but it's taking longer to sell, can you continue making those payments while also paying for other closing costs such as utilities, property maintenance and insurance? If you feel confident about a property after completing an exhaustive risk analysis, then you should definitely consider purchasing the property. Money can be made in almost any market condition, but you must know what the risks are and be comfortable with them since real estate is not terribly liquid. Good luck with your endeavors and stay safe.


about 1 month ago
Disclaimer: Answers provided are just opinions and should not be accepted as advice.
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