Panic selling, impulsive purchasing, jittery markets, remote work, and the desire to obtain more space for much less money in the midst of the growing epidemic have produced one of the most frantic and volatile real estate markets in queens in a period in less than twelve months.
During the spring months, the COVID-19 pandemic had a significant impact on the residential real estate market in the United States, including one of the boroughs of New York, Queens.
Many metro areas saw a significant drop in home sales due to health concerns, stay-at-home orders, and economic uncertainty.
Last year was a giant question mark for everyone — especially those in property management and the real estate business — or perhaps an endless series of swear words.
A Rise and Fall in Buying and Selling
As the epidemic spread through one of the largest boroughs of New York, Queens, and the economy began to suffer, many buyers postponed house purchases or shifted their focus to locations outside of the dense urban core, where lower density meant lower transmission rates and previous restrictions were lifted.
In April and May, house sales fell to their lowest levels since the beginning of the housing and financial crisis in 2007, with many homeowners hesitating to sell in the aftermath of the epidemic. According to a major real estate agency in Queens, the number of houses delisted climbed by nearly 25% from early March to early April last year.
Buyers have also slowed down their property purchases. In April, the number of showings per listing in the United States fell by more than 40% compared to the same month the previous year. Other home demand indicators, such as internet search activity, agent inquiries, and offers made, were all down dramatically in April.
A significant dip in demand for new house sales is usually followed by a reduction in pricing. However, the coronavirus scare in the spring did not result in significant price drops. Throughout April and May, prices remained stable due to a combination of little supply and recorded low borrowing rates.
Then, in September, sales activity peaked, with even fewer deals completed than in April. Six months into the epidemic, just 1,559 transactions were recorded in September, a stunning 56 per cent decline year over year.
COVID-19 forced millions of Americans to move in 2020. This included students leaving closed college dormitories, employees returning home or relocating to “Zoom towns” to clock in remotely Baby Boomers downsizing, and younger families and Millennials shifting up to bigger houses in outer sections that created a more COVID-friendly environment.
Recovery in Times of Hopelessness
The real estate of Queens has been recovering from the pandemic’s economic effects. Despite the fact that rents in queens have been declining due to excessive vacancies, we see a dramatic slowdown in those trends. New lease contracts are being signed on a monthly basis, and rental rates are rebounding as a result of the increased demand.
Many people are still haunted by fears from the 2007-09 housing crisis, as some homeowners have failed to keep loan repayments, and the jobless rate remains at historic highs. Many families are evaluating their housing demands as a result of the epidemic since their houses have become substitutes for offices, schools, restaurants, and amusement centers.
Residential real estate activity is highly dependent on local conditions, so while practically every major metro area witnessed a considerable dip in activity during the spring, certain places that were particularly badly struck by the pandemic had particularly steep declines. Pending home sales in Queen’s real estate fell by 58 per cent in April compared to the same month last year.
Despite the pandemic’s substantial reduction in house sales, real estate activity began to revive in late spring, returning to pre-pandemic levels by summer. By the end of May, potential buyers had increased their property search and purchase activities.
Pending sales in the New York borough Queens, which were down more than 30% in April, were up about 30% by August compared to the same period last year. The growth in online and socially distant viewings helped to boost home showings per ad from lows in March and April to levels well above pre-pandemic levels by May.
Housing supply hasn’t recovered at the same rate as demand. Despite recovering from April lows, new listings were only modestly higher than a year earlier in August. As a result, inventory levels have continued to fall.
Despite some signs of recovery in the economy, the housing market may continue to be impacted by high unemployment and economic instability far into 2020 and beyond.
It’s yet unclear whether these alterations will be lasting or reversible. Working from home during a pandemic, for example, may be advantageous when leisure and in-person networking possibilities are limited.
Property is a long-term investment and the greatest asset for many families, so even if attitudes shift permanently, the current economic instability may keep potential purchasers on the fence for a while. A continuous rise in housing prices, combined with a restricted supply of inventory, may make it difficult to act on these prospective changes.