A report from the National Association of Realtors says upwards of 47% of people caught in tight financial situations are considering selling their homes.
For the New Orleans market Real Estate Economist Wade Ragas says he understands why people are worried:
“When you have a group this large of the population, this percentage of it, a quarter or more that’s been laid off, yeah, you’re going to have people who are so distressed they go back to living with other family members and taking jobs in locations that they never have considered before.”
But, Ragas says right now is not the time to sell.
For much of the market, the number of houses that have sold has fallen and how long they were on market has risen, “Ragas says. “So over time—it’s been three months—there may be pressure for them to cut price to get it sold.”
According to Ragas, there is one sector of the market that is moving: Baby Boomers.
“It makes sense, as you get older you don’t need the space. Why have empty rooms you pay for? Why not have somebody else pay for them all over again?”
Boomers are downsizing, living in smaller homes—usually in a beachside community.
“They relocated to a small house, for their family and the original family home, they sold it and got the cash out of it. And that’s particularly true for higher value markets.”
Ragus also points to the density factor and easy spread of Coronavirus that is driving a new push out to the suburbs or beyond:
“The more problems we’re having with the virus, and the severity of it, and the quantity of people getting ill, so the more virus that is floating around in the air per cubic foot, the higher the chance you have to catch something.”
Right now, according to Ragas, the problem with the market is not slow sales, but the saturation of the commercial market.
“There’s so much of retail that considering it does very well, has taken such a hit, not being able to open and function normally, that it’ll be interesting to see what percentage of all the existing stores are really going to come back.”
