The Covid-19 pandemic had a devastating impact on lives across the globe. Aside from losing loved ones, people are also struggling with the loss of income and livelihood. Despite all these challenges some sectors in the economy, including real estate, maintains a positive outlook. Probably because it’s considered as a safe haven even at times of crisis. One of the things people realized during the lockdown is the importance of having a home for the family. But is it a good idea to buy a new house now? Have a look at the home-buying scenario under new normal circumstances.
Real estate outlook during a pandemic.
Although the real estate sector was among those badly hit by the Covid 19 pandemic, it has remained stable in the past year. There was even a 27.1% growth in residential real estate prices during the 2Q of 2020 according to BSP records. The industry is also adapting to the changes in the economy by rehashing the use of commercial real estate in order to make it profitable again. Overall, the sector is expected to slightly recover this year because of the increase in demand for industrial, office, and residential real estate.
Home buying scenario amidst Covid-19.
For home buyers, now is a good time to look into properties that you can invest in. This is because the pandemic also opened attractive and more flexible buying terms for property seekers. One example of this is the low lending rates set by the BSP which will make it more affordable for homebuyers to get funds for their new home. There are also plenty of opportunities to buy properties that are lower than pre-pandemic prices from property owners who prefer liquidity over fixed assets.
New normal mode of home buying.
Given the restrictions and health protocols currently imposed by authorities, a new normal approach can also be taken when scouting for a new home. Just like pretty much everything we do nowadays, the initial steps for home buying can also be done online. You can go directly to the website of property developers and check out what they have to offer. There are also property portals like Lamundi that offer a wider range of real estate options. Some of these sites offer virtual tours of the property but of course, nothing beats real-life inspection in buying properties. The online tours simply help you gauge which properties are worth your visit.
Home Buying Basics.
Buying a new house is a commitment that should be considered carefully. It’s not something that you can easily return and get a refund if it doesn’t work for you. The basic questions that you need to ask yourself are.
- Am I ready to own a house? Owning a house means you should also be responsible for its upkeep and maintenance, tax compliance, and other obligations that may be imposed by the government or community.
- What kind of residential real estate should I buy? The type of property that you buy should primarily depend on what you need. For instance, if you are single and would want to simply have a place of your own then a studio-type unit is a practical option. However, if you are starting your own family you may want to consider the future needs of your family in choosing a property to buy.
- Where should I buy a house? Location is also a primary consideration when buying properties. Ideal locations are those near schools, hospitals, churches, and workplaces. If you would also like to invest in the future value of the property then your best options are those that are located in potential real estate boom areas.
- Can I afford it? This is perhaps the most important question that you should ask. The last thing that you want is to purchase a property through a loan or mortgage then end up foreclosing it. Check your finances first before committing to the purchase. There is a mortgage affordability calculator that you can use to assess your financial capability for home buying.
Mortgage Affordability Calculator:
The demand for residential real estate is expected to continue despite the pandemic. This is because our population continues to grow and homeownership is a primary goal of most families. Another factor that makes home buying attractive despite the present scenario is the expected increase in land prices post-pandemic. This observation is made based on historical data on the 2008 financial crisis.