Covid-19 has changed the world as we know. Countries were put under lockdown, and economies were hit, people lost their jobs, almost every sector was impacted, especially the real estate industry. While some renters struggled to pay rent, others chose to move into smaller places while a few others decided to put together their life savings to invest in a property they could call home. Coronavirus pandemic impacted everyone very differently.
While some people started thinking about increasing their earnings, others began working towards owning their own home. After all, times of uncertainty make us want to control as much as we can. If you’re thinking about investing in property amid the pandemic, maybe you’ve already spoken to estate agents in Leamington Spa, or perhaps you’re already looking at houses in the area. Then you must consider this investment guide with pros and cons by the estate agents in Coventry to help you decide whether or not you should buy a property during this pandemic. After all, this needs to be a well thought out decision!
The pros of investing in property during the pandemic
Banks have slashed the interest rates for mortgage loans and home loans. With the introduction of the stamp duty holiday, investors have a chance to buy great property at great deals. The Chancellor of the Exchequer has reduced the stamp duty to zero per cent for property under £500,000. This has allowed investors to save thousands of pounds, making their investment value lower and very budget-friendly. The estate agents in Nuneaton can show you fantastic property within the stamp duty mark.
Good deals in the market
Due to distress sales during the pandemic, investors might be able to grab an excellent property for a nominal price. Also, developers and builders who are either creating new projects or have recently finished new projects offer great discounts and deals as incentives for investors to buy property. This means a potential buyer might be able to buy a new apartment at a great price, thanks to the many discounts offered in the current market. The Allsopp & Allsopp estate agents and lettings agents in West Midlands and Warwickshire could help you with some fantastic deals in 2021.
Stable supply, low demand
Due to the uncertainty surrounding COVID, there was a change in the demand for property. The need for real estate has decreased, but not by much. However, this decrease in demand and a steady supply has led to a slight decline in prices. Also, since the demand is not too high, there is not too much competition among investors. So, a seller is highly likely to offer a potential buyer a good deal, especially if they’re looking to make a quick sale.
A safe investment
At this point, with the uncertainty of what the future holds, property investment seems like a very safe and sound investment. With economies falling and unstable stock markets, it appears that investing in property is the only way to make a profitable return in the future. Of course, investing in the right property at the right time, for the right amount of money, is crucial.
The cons of investing in property during this pandemic
Uncertainty of future prices
At this point, a potential buyer might think that he or she is getting a great deal. However, the real estate industry’s future is rather uncertain because no one knows what will happen post-pandemic. That means the future valuation of property is unknown. Of course, buying property in prime areas is always a good idea, but you never know the property value in unpopular areas in the future. While real estate prices are expected to rise post COVID, there is a high possibility that the value of property reduces in the near future because of the after-affects of the pandemic.
Strict loan criteria
While the interest rate might have reduced, the number of criteria banks are looking at before lending money has undoubtedly increased. Banks want to see a very high credit score, bank statements, a strong history of timely payments and a steady income. Due to this, it might be difficult for potential buyers to get pre-approval. During this pandemic, looking for houses without a pre-approved mortgage is almost impossible!
Uncertainty of employment
One of the biggest challenges of COVID is the uncertainty of jobs. With large multinational corporations laying off hundreds and thousands of employees due to the pandemic, almost every working individual is concerned about their job To invest in property, you need to pay your monthly mortgage, which is very hard to do without a steady income. So, while the property deal may seem too good to be true, you must have a regular income that you can use to pay off your loan while maintaining your day to day expenses.