The growing concern about the spread of COVID-19 has affected business throughout the world. However in local real estate, both buyers and sellers are already crowding the market. What’s fueling this real estate excitement?
Declining mortgage rates
COVID-19 has affected the market, driving mortgage interest rates down to new historic lows. Homebuyers are seeing the benefit of these low rates when measuring the price and size of home they can now afford. Dream Town broker, Dee Savic states that open house traffic is “definitely much busier than usual, mostly due to interest rates dropping to historically low levels.” It’s a win for both buyers who can afford more and for sellers who can get the ideal price they’re seeking.
Even those who aren’t buying, or selling are cashing in on low rates through refinancing their homes. This creates an opportunity for owners to tackle new home improvement projects, consolidate debt or simply build their savings.
Many brokers have seen no slowdown in open house traffic, with an increase in activity due to the improving weather.
Chicago spring came early, and buyers are here for it. “The market between $250-$600k continues to accelerate despite the COVID-19 warnings. It was 60 degrees and sunny, my open houses in Chicago were flooded with buyers,” states Christine Carr of Dream Town.
Sellers know there is a risk to inviting strangers into their homes, but the benefit of foot traffic for a sale is worth it to most. “My clients still want open houses. We had 27 groups come into one yesterday”, remarks Barbara O’Connor, Designated Managing Broker of the Lincoln Square office of Dream Town.
Brokers have also seen an increase in luxury market demand, which shows no signs of slowing this spring.
According to Diana Massaro of Dream Town, the static luxury market we have seen in recent years is bouncing back in 2020. She shares, “I wrote 10 offers in the past few weeks for buyer. Even the luxury market has picked up. I have a few $1M-$1.5M buyers, and we’ve been competing with multiple offers and open houses are slammed. This was not the case in the last 2 years.”
Still, as the virus looms, brokers have been taking precautions to do what they can to prevent the spread of germs, from regularly using sanitizer to coming up with creative handshake alternatives. Nykea Pippion McGriff states, “I am actively carrying hand sanitizer and trying to avoid touching surfaces. I used to initiate handshakes, but do not now. I still will shake hands if the other party initiates. I had two open houses this weekend and still had good attendance at both.”
Brokers are letting their clients make the call when it comes to safety and comfort. Heather Hillebrand, Designated Managing Broker of the Lincoln Park office of Dream Town tells us, “I did have two houses my client wanted to see—owned by elderly homeowners in Evanston—cancel all showings for the foreseeable future due to the virus though.”
While we don’t know the future of this virus and its long-term effect, we are seeing quite a contagious spring fever in the Chicago housing market. Read more about the Coronavirus and Chicago’s housing market on Curbed.