Hoover, AL – Glenn S. Phillips, CEO of Lake Homes Realty, has provided thoughts on the current situation with the COVID-19 pandemic and the real estate marketplace. Glenn is a sought-after speaker in business circles who maintains strong relationships with many national sources of business and real estate information from the FED to NFIB and NAR. A few Glenn’s insights on the current business climate in real estate:
COVID-19 And The Shock To The Real Estate Market
1. People need time to digest the shock and collect themselves. Just like someone in a car crash, it takes a little while to regain your bearings, evaluate other risks, and check for any real injuries.
Therefore, I expect residential real estate markets, including lake real estate, to pause through at least April and May. And maybe longer. We anticipate an 80% to 95% drop in transactions compared to these months in 2019.
2. Compared to the real estate boom and bust of a few years ago, the real estate industry is on much more solid ground. In that recession, real estate and lending lead to that disaster and therefore, could not lead the country out of the cycle.
This economic crash has more in common with 9/11, which was an external event to the markets, not a failure by the markets. This leads us to believe that once the shock wears off and businesses are allowed to restart, demand will resume across the economy.
We also believe, at least for now, that by 2021 the real estate markets, including lake real estate, will be similar (+/- 20%) to the market volume of 2019.
Moving Signals In Real Estate
3. When will we begin moving from the pause to a more regular volume of transactions? While no one knows, there are two signals.
The first signal is the point in time where the number of new cases of COVID-19 begins to level off or decline in the U.S.
The second signal will be when restaurants, bars, and travel return to normal (or mostly normal) operation. This second signal will most likely occur after the first. However, together these will signal to early movers in real estate that they can begin actively returning to the market. And they will.
About Lake Homes Realty
Lake Homes Realty (LakeHomes.com) is a multi-state real estate company focused on lake homes and land.
The Alabama-based brokerage has been named three times as one of the fastest-growing companies in the U.S. by Inc. Magazine. Lake Homes Realty is a licensed real estate brokerage in 28 states and is growing rapidly into additional states.
For more information, visit https://www.lakehomes.com/