With house prices falling due to the pandemic, it’s tempting to take advantage of the housing market. Selling now could be a smart way to recoup the value of your home while saving money. After all, the drop in house prices should let you snap one up pretty cheaply in theory. However enticing it sounds, it’s not a good idea. The truth is that there are too many variables to factor in because the COVID-19 crisis is so unpredictable. You’re better off investing in your current property and reassessing the market in the future.
Here are the reasons why.
Credit’s Harder To Secure
Yes, the housing market is nowhere near as valuable as before Christmas. Still, banks and lenders have reacted by making it harder to secure funding. Currently, Chase is saying that people who want a mortgage will need a credit score of 700 or more, which is very high. Plus, you’ll need a 20% deposit, too. On the face of it, these conditions are too stringent for the average homeowner and exclude you from obtaining a second loan. The last thing you want is to accept funding from a payday loan company or a loan shark to make a few bucks.
Fewer People Are Looking To Buy/Sell
Money is tight at the money, so it’s not as if the demand for property is high. If anything, it’s the opposite. Even if you could find a buyer, you’d need to search for a new home, or else you’d be homeless. Usually, this is the easiest part of the process, yet the Coronavirus has made it somewhat tricky. The percentage of houses for sale across the country are in the minus column, with only Detroit and Chicago showing room for growth. So, the odds of selling and buying a home right now are very low.
Supply Lines Are Disrupted
China is a hub for cheap materials. Of course, the virus has hit the nation harder than most places as it originated in China. As a result, exports are limited, and builders’ supply lines are reduced. This could delay constructions that add value to your property. Thankfully, North American windows and doors are still affordable and accessible. This means you can spruce up the interior of your home to add value and bide your time. When the market goes back to normal, you’ll be in an excellent position to sell for a profit.
Jobs Aren’t Guaranteed
The worst-case scenario is that you lose your job. While everybody assumes it won’t happen to them, the figures paint a different picture. The rate of unemployment is at a staggering 15%. To put this into perspective, it was as low as 3.6% in January. You could be fortunate enough to keep your job, but it isn’t a sure thing. Therefore, making a massive commitment is a stretch that could hit you hard.
The short, medium and long-term are unpredictable, which is why you shouldn’t sell your home.