My house value vs The Coronavirus.

My House Value

vs.

The Coronavirus

My House Value

vs.

The Coronavirus

Will my house value plummet because of this latest pandemic?

Global stock markets lost 6 trillion dollars, in 6 days, because of the Coronavirus.

Surely the value of my home has plummeted too?

Yes, CNBC reported that the stock market lost 6 trillion dollars!

That is a fact. That is scary for sure.

Raise your hand if that made you ask:

Is my house value going to drop? AND if so, how much? 

How should I react? AND What can I do anyway?

Is now a good time to buy or sell?

Has this happened before?

AND

Can we learn from history?

TABLE OF CONTENTS:

Final Summary: Here is the cheat sheet… Don’t want all the details? Here I lay out all the facts and my opinion of our current situation.

Question Number 1. Is my house value going to drop? AND how much?

Now in greater detail…Is my house value going to drop? AND how much?

Where were we headed before CO-VID 19?

Why hasn’t the housing market crashed?

What is going to happen to the price of houses in my area?

Is now a good time to sell?

What can we learn from history?

BONUS MATERIAL AND FINAL THOUGHTS: Spread the word and how to protect your house value against the coronavirus. 

Is it really different this time? Let’s find out…

For most of us, our house is the most valuable thing that we will ever own.  Because of this, we are afraid of what is going to happen.

Before I did this research, I was very unsure too. I didn’t know what to think. I definitely wanted more information so I could understand how it might play out. I was stressing out!

SO…I did some digging. A LOT OF DIGGING!

AND

Want to know the answers I found?

Here they are…Question Number:

1. Probably and depends

2. Be patient and make plans

3. Now is a good time to buy and sell. You just need to do it slightly differently (like with a virtual walkthrough, etc.)

4. We have had global pandemics that have rocked the world’s confidence.

5. A lot! (but you have to keep reading to find out the relevant stuff).

There they are. The answers to your questions.  (maybe you need to look at the questions again – see below)

  1. Is my house value going to drop? AND how much?
  2. How should I react? AND What can I do anyway?
  3. Is now a good time to buy or sell?
  4. Has this happened before?
  5. What can we learn from history?

I have to say – since learning the answers to these questions, I have actually been sleeping better!

I feel more confident.

I feel more secure.

Ever since doing this research, this is how I sleep now… very soundly.

I really believe you can too…

Now you will sleep better too… Right?

Maybe? Maybe not?  The answers were pretty short…

HERE IS A SECRET:  just for you…don’t miss it – from here on out, I will 100% explain the answers for you.

I am not promising miracles here but keep going, and you will learn a lot of facts about the US housing market. I will tell you what “EXPERTS” are saying. I will show you what has happened in recent history.

AND FROM THIS YOU UNDERSTAND…

Why I am now confident about the price of my house.

For example:

Question Number 1.

 Is my house value going to drop? AND how much? 

 ANSWER: Probably and depends.

I know what you are thinking…

“What kind of answer is PROBABLY AND DEPENDS?” AND “If it’s probably going to drop, why do you feel good about it?”

I will explain now with a short story…

MY FEAR STARTED BECAUSE…

The news made me feel like my house value was going to drop 30% overnight.  This was because the stock market dropped so much

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However… 

I found out the stock market and the housing market are not directly tied to each other. 

AND

I found out that the government is spending lots of money to help the housing market. 2 trillion dollars, in fact!

ALSO 

I found out that currently, my house is worth the same as it was 3 months ago.

 PLUS

I found out the fed dropped rates.

Because they dropped rates, my house value will be protected somewhat.  

I found out that people are still buying and selling houses.

I found out that many states consider real estate an essential service, so they are helping the industry. 

I found out where the real estate market was heading before the virus.

AND 

I found out that what is happening with housing is all part of the normal cycle.  This cycle is predictable in that it goes up, then down, and then up again.  

THE LIST CONTINUES

I found out that we have seen similar events in the past like SARS and H1-N1.  These events helped me see what happened previously. 

AND FINALLY 

I learned that the housing market is in a much stronger position than it was in 2008. (I briefly touched on this already).

THAT’S A LOT OF LEARNING!

Go back and read through that again – those are all things I learned! They are real! If you want more details, they are all below. This is great stuff – I’m telling you. 

Of course, every time it is different somehow, but after I learned all of this, I felt so much better.  

NOW I WILL GIVE YOU THE DETAILS:

Come on – give up a few more minutes of your time. I 100% guarantee that this article will tell you more detail on what “I FOUND OUT.”

 

DISCLAIMER:

What I write is my opinion of the current situation. I formed my opinion by reading, researching, talking, and listening to lots of different people. I have actively participated in the real estate scene for over a decade. I have bought and sold houses. I have been a landlord and lender. Most people know a lot more than me, but I am giving you what I know. 

Some of you will probably disagree with my opinions. 

 AND – that’s ok.

If you disagree, please tell me in the WHY YOU DISAGREE – comments section. 

If you agree, tell me that too.

 THE POINT IS…take this information and run with it. Don’t just stop at the end of this. There is so much more great info out there!

Yip, that’s me – And I have a huge favor to ask below…

I hope you will consider it. 

Lastly,

If you find this useful, educational, or just a little entertaining, I kindly ask that share my story with your family, friends, and associates. Again I would also love to hear your feedback, which you can leave down below. 

Thank you very much

SM.

SO that all said

Back to the problem at hand.

Let’s look at your questions in more detail.

Is my house value going to drop?

AND

how much?

I must admit,  my first reaction to the pandemic was “OMG” 2008 all over, the sky is falling! Along with the value of my home!

AND

This sent my blood pressure through the roof.

But then I thought, hold on, what really is going on… is my house value really changing?

Let’s take a look…

To determine if house prices are changing I asked: 

1. What has the market been doing recently?

2. How have prices changed over the last decade?

3. Where were we headed before COVID-19?

4. Since COVID-19 what has happened? AND why?

5. What does that mean for me?

Let’s dive in…

What has been going on recently? 

House prices had gone up a lot (that’s a mild understatement) over the last decade.

IN-FACT Over the last 10 years, house prices skyrocketed to record highs.  

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Where were we headed before COVID-19?

Because house values had gone up for so long a growing number of “Real Estate GURUS” were saying the housing market was going to slow down soon,  even without the virus.

I looked at the data – and they were right.  In 2019, the rate at which house prices were going up had slowed down.

So prior to the Coronavirus pandemic the housing market was cooling and we were at record highs.

Not so bad…right?

What’s next?

What has happened since the Coronavirus struck

BACK TO TABLE OF CONTENTS

Since the Coronavirus struck, the housing market crashed, right?

WRONG!

There has not been a housing market crash!

In fact, house prices have not dropped at all in 2020.   

That was really exciting news for me to find out.  How does it make you feel?

It does lead to more questions…

Why hasn’t the housing market crashed?

Didn’t the stock market drop more than ever?

AND if that’s what you asked…. GUESS WHAT?

You are right!

The stock market lost 6 trillion dollars in value in 6 days! However,

The stock market is not directly tied to the housing market That is a fact!

Because the 2 markets are independent of each other, when one goes down the other doesn’t necessarily have to change.

Furthermore, history shows us that the housing market generally reacts more slowly than the stock market. This gives us all time to prepare.

So we now know that house prices have not plummeted. Your house is still worth the same as it was a month ago.

GREAT NEWS…RIGHT?

How about some more good news?

Since the CORONAVIRUS struck two really big positive things have happened.

FIRST:

The U.S. Government wrote a check for 2 trillion dollars to help keep the economy moving.

AND SECOND:

The Fed cut interest rates to historic lows.

Let’s quickly look at why these two things are good news for the price of your house.

First:

The U.S. Government wrote a check for 2 trillion dollars to spend throughout the country. In very simple terms they will use this money to buy things. This will keep cash flowing around our communities.  This means there will be less job loss in the medium term. This will make a difference. Be happy your government can do that for you. It is a huge plus.

Second:

The Federal Reserve cut interest rates twice since the start of the crisis.   This sent 30-year mortgages to historic lows.

When rates are this low 2 things happen:

1. People want to buy houses because mortgage rates are really low.

AND

2. People refinance making their current mortgage more affordable.

The 2 trillion dollar check and super low-interest rates will 100% help, not hurt, the value of your home.

Can you start to see why I can sleep better compared to a week ago?   Go back and read the last page or so. There are some really positive things happening.

So…

BACK TO TABLE OF CONTENTS

What does this mean for you and the price of your home?

Maybe you live in a different part of the country?  Is information this relevant to you?

Yes, it is relevant to you. Everything we have learned is relevant to you.

You ask…

What is going to happen to the price of houses in my area?

I can say with great confidence that house prices probably aren’t going to go up in the foreseeable future.

 AND

 Over the coming few years there is a chance house price will go down.

(prices were predicted to level off even without the virus so this is ok)

ALSO Remember,  

The value of your House did go up a lot over the last decade.

Finally remember you know house prices go up, then down. Then they go right back up again.

BACK TO TABLE OF CONTENTS

Below we see what has happened to house prices in red and what is quite likely to happen in the future

BUT  

“What if I was going to sell my house?”

Is now a good time to sell my house?

The first thing to say is…. 

That depends.

 Don’t you hate that?

It depends on whether or not you were planning to sell before this pandemic.

If you were planning to sell before CO-VID 19 struck, then you still should.

Your plans will be slightly different because of social distancing etc. but STILL MAKE PLANS.

Another excellent thing to know is…

Are homes selling in your area?

The best answer is again…  

That depends.

Sorry about that, but it really will depend. 

Some things will make selling houses harder right now.

For example:

Social distancing and the stay-at-home orders will make showings more difficult.

 AND

Business shutdowns – like title companies,  appraisers, and inspection companies shutting down will slow down the closing process. 

But for now…

Many states like California, Colorado, Wisconsin, and Connecticut have made real estate services – “essential services.”  By doing it an essential service, houses can still be sold relatively easily

To know more about your specific area, do some homework. Take a few minutes –

Call an agent, a title company, your bank. Ask, “Are houses selling right now?”

Their answer will most probably be yes, they are.

Back too…

Is now a good time to sell a house?

Let me repeat it. If you were thinking of selling your home before the crisis, then continue making plans because it is still a good time to sell.

Inventory is still meager.  People just can’t find a house that they want.

Mortgage rates are at historic lows.

The value of your house is still very similar to what it was 3 months ago.

Yes,  it will take a little longer to sell right now.

But come on, people, let’s do it!  Get out ahead of other potential sellers who are nervously waiting.  You have the knowledge now. You have the power. Use it.

If you use some common sense and good ideas, your house will still sell.

If you plan to use an agent, you should ask them what they are doing differently because of the Corona-virus. If they are a good agent, they will tell you their plan. And if it makes sense – do it!

OR Alternatively,

You could do what my friend did…..

She listed her house on March 18th. She took a video of her house with her smartphone. She shared that video on Facebook.  Heaps of people contacted them to buy it. A person gave them an offer that they accepted.

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When it came time for inspections and appraisals, she simply left the house. Social distancing, right?.

Side note – both the inspector and appraiser had great Coronavirus plans in place. She did ask them about it and they told her exactly what they would do. NICE!

Guess what…  She is closing in 2 weeks!   So you see, 

With a little innovation and common sense, they got their house sold.  You can too!

 SO… YES… Now is a good time to sell!

Buying a house can happen just as easily, just in reverse… right?

Don’t you think that’s great?

Let’s summarize one more time – because we have a lot of info here.

  • Houses have maintained their value.
  • Many great things are happening to support the housing market.
  • Now is still a great time to buy and sell. In fact, you could get the best deal of your life right now!

Will house prices go down…What can we learn from history?

A quick note on what we can learn from 2008 and how the market is different now.

We can learn a lot from the 2008 “Great Recession” period.  Back then, millions of people couldn’t afford their mortgages because of crazy bank loans. Default rates were through the roof. This led to millions of foreclosures. Those loans don’t exist anymore. Currently, default rates are at historic lows.  Therefore the housing market is much stronger.

I plan to write more about this in the not too distant future. Keep a lookout for it.  If you want me to send it as soon as it’s ready shoot me a message down below in the comments section.

How about just one more step….

How can we further understand what might happen?

 WELL…

 We can take a good look at what has happened in the past. 

Ever heard the saying, “history repeats?”

Let’s do this together real quick.  I guarantee it will help you.

We have time, right?

Remember, we are all stuck in our houses.

For me, there are only so many Friends episodes I can watch again. Surely you can take just a couple more minutes…right?

Besides, it’s exciting.

This is the best information yet – Don’t miss it!

In the U.S, there were three major events in the 2000’s – 

  1.  9-11: Terrorist impact on the US (2001)
  2. SARS: Severe Acute Respiratory Syndrome (2003)
  3. H1-N1: Swine Flu (2009)

 DID YOU KNOW that in 2009, in the US alone, the swine flu:

 Infected 60.8 million people

Hospitalized 274,304 people 

 AND

 Caused the deaths of 12,469.

This is according to the CDC.

So how did the 3 events affect the US economy?

A study by Ted C. Jones, Ph.D. looked at this. 

He wanted to see if the unemployment rate went up or down during SARS. He wanted to see what happened to house prices too.  He wanted to see if these events changed the direction the market was already heading in.

He focused on 6 key numbers. These were:

  • U.S. Employment Rates
  • 30-year fixed-rate conventional mortgage rates
  • U.S. existing-home sales
  • Median price –  U.S. existing-home sales
  • U.S commercial real estate sales
  • Commercial real estate capitalization rates.

At the end of his study, he wrote “ no major impacts were seen in these 6 variables attributable exclusively to the three events”

That means, none of these events really changed the course of our economic direction or history. 

 To really simplify it….(and it’s great news) 

 It means that our economy was able to weather the storm. 

 

Let’s take an even closer look at SARS

Many professionals believe SARS is the most relevant to our current situation.

SARS affected Hong Kong. Hong Kong is another large real estate market therefore it is relevant and we can learn some lessons from there. 

SARS was a very serious disease

HOWEVER

Hong Kong’s housing market was no-hit not as bad as I would have guessed. 

The total number of houses that were for sale did fall sharply.  This was because people didn’t want to catch the disease. They were social distancing (like now).

But on the positive front…

 We can see that the value of the houses that were already for sale remained the same. Experts said this was because of limited inventory.  

Do you know where else has limited inventory right now?

Absolutely everywhere in the United States!

And that’s ANOTHER really good thing for you, right?

How can we apply these lessons to the value of your house and the coronavirus?

From Ted’s research – we can be confident that our economy will weather this storm.

And from Hong Kong, we must note that, because house prices did not fall off a cliff due to SARS, maybe house prices will be OK now.

Ted’s research says that house prices will continue to do what they were doing prior to the event. 

SO

“What was the market doing before the pandemic?”

House prices were at an all-time high with predictions of the market’s cooling.

Therefore

We will see a cooling of the markets.

AND that’s OK – it really is!

In my opinion, it would seem the pandemic just pushed us a little more in the direction we were probably going to go anyway. 

WHAT ARE YOUR OPINION?  – Please leave a comment…

What are your friend’s opinions?  Please share this to find out

I would be super grateful if you shared this – I promise it will only take 17 secs

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FINAL SUMMARY:  How is CO-VID 19 going to change the value of my home over the near future.

What do I think is going to happen to the value of my house?

After doing all this research this is what I have come up with:

1. The value of my house has never been higher. 

2. Many experts were saying that the market was going to cool off soon.

3. If I want to sell my house, I can.

4. If I want to buy a house, I can.

5. The government and the FED are working to protect my home’s value.  

6. We have seen similar major events in recent history.

7. Throughout those events, our economy was able to weather the storm.

8. Research shows us that the direction the housing market was headed in before CO-VID 19 is probably the direction the housing market will continue regardless of CO-VID 19. 

9. The housing market is in a much stronger position than it was in 2008. 

To summarize the summary:

We are going to be OK!

In my opinion, if I am patient and talk to a lot of people and apply common sense I will be able to get through this period of uncertainty and the value of my house will still be at good levels – probably down some – but if I hold onto it – it will come back up and the economy and I will be ready to rock and roll!

Now you know why I can sleep better. I hope you will too.

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BONUS MATERIAL… Spread the word.

 

Come on!

House prices are predictable to a large degree.

You know that now. They go up and down. Then they go up again.

That said going forward we need to be smart.

COVID 19 appears to be speeding up the transition from prices going up to prices going down.

We are living in uncertain times.  Things are changing. There are scary headlines multiple times a day.

We must heed these warnings. We must listen to the CDC, UNICEF, and the World Health Organization.

BUT, we must also cut through the noise.

FINAL THOUGHTS ABOUT:  WHAT CAN I DO NOW TO FURTHER PROTECT THE VALUE OF MY HOUSE AGAINST THE CORONA-VIRUS 

When it comes to the housing market – knowledge is power.

Remember what we have learned.

The real estate market was cooling off anyway.

It is normal for it to go down after it has gone up so much.

It will go up again in the future.

TALK TO PEOPLE.      Reach out to people.

If you reach out to one new person a day you will get through this.  I guarantee you will come out the other side bigger, better, stronger, and ready to rock and roll!

Reach out to your lenders, Reach out to people that buy houses (companies like the “we buy houses”)

Reach out to people that sell houses (“we buy houses” sell houses too).

Talk to local agents. Call title companies – ask them if they are still doing closings. Talk to anyone that will talk.

For example – I just did a demo with a company called PRIVY. They are a user-friendly property analysis platform. They don’t pay me – in-fact I now pay them for their service.

During the demo, I was able to exchange info on what we were both seeing. It was super beneficial to hear another professional’s viewpoint.

SO again – talk to people! (just do it online – probably not in person for the moment… right?

WE BUY HOUSES – are they really worth talking to?

Firstly

Any company that can buy your house from you using “cash” is a “We Buy Houses” company. That’s what I mean by “We Buy Houses”

AND

Believe it or not, those companies can help you a ton.

They can find you a great off-market property to buy.

ALSO

They can give you a great price when selling. Let me explain.

For example:

They won’t charge you a commission.  Let’s say you sold your house for $300,000 using an agent. After typical fees, commissions, bank charges repairs, inspections, and appraisals a lot of people will walk away with roughly $250,000. Investment companies will possibly offer you $250,000 cash OR MORE.

Agents do have great resources for you and often that is the best choice.  Just understand you have lots of options right now!

YOU REALLY DO.

Landlords… are you listening? Recently rents have been a huge topic of conversation. Are you worried about collecting your rent?

Buy low, sell high… right?

Maybe now is a good time to REALIZE some of those massive gains you made.

The house you paid $170K for MIGHT BE WORTH $240,000.

Take the gains…  Then stay in touch and in the not too distant future you can buy back in low.

Sounds pretty good to me.

So landlords, do a little research.

Is anyone contacting you to buy your rental right now? If they are, they are serious cash buyers!

Remember, they understand what you need because, just like you, they are investors.

Chat with them. Run the numbers with them.  Sometimes there is a shock with the initial offer, but it can actually be pretty darn good when you work through it.

So thanks for hearing me out. I have enjoyed this time together.

AND

Above all, I have to say it…

Be good to people.  It does make all of this easier.

Be kind to people. It will make a difference.

Be smart, be safe

Sincerely

Shaun M.

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Hi, My name is Shaun. A while back my I did not feel secure at all. For me, this is very personal. I do understand the stress, anxiety, and fear of the unknown.  Because of this, I know I can at least hear what’s going on for you, maybe show you that you do have options.

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