Virtually all sectors of the economy have been ravaged by the novel COVID-19 pandemic, but the real estate industry may have been the worst-hit.
Truly, the world has been taken aback and is in a standstill because of the COVID-19 virus. Meanwhile, the counting is ongoing in countries and virtually all countries in the world have a recorded case. It has taken a toll on the world economy, as businesses including the real estate industry have been crippled. However, with countries on the course of relaxing total lockdown, it is imperative to find out some important information about real estate investment during the pandemic.
1. Firstly, the stocks market has recorded a fall by over 1000 points. However, few real estate developers are still in business.
For instance, The Avenir condo earlier closed their showrooms till early June. Meanwhile, they have opened it but are only operating virtually. Information kits, tours of the condominium, and booking of visits are done online. Investors who wish to visit the showroom physically must adhere to the prescribed precautions. More so, Avenir developers have implemented strict social distancing and crowd control.
Learn more: https://theavenircondo.sg
2. Negative impacts on commerce
Commercial Real Estate has been slammed by the pandemic. It all started in Asia, and the impact is widely spread in big cities of the Asian continent. People are locking up their shops and malls and everyone has retraced to their homes.
3. Workers in retail shops have been laid off while some are placed on temporary retrenchment.
People are no longer allowed to spend time in Hotels and restaurants, but some restaurants now resort to delivering their meals directly at the doorsteps of their customers. However, travel bans are still in place, the towns and tourists places are isolated. More so, companies are not offering sales. This has forced them to refuse to pay their workers, as they are trying to figure out how they will pay their rents.
4. Businesses are seeking for rent waiver
Owners of business enterprises are soliciting for real estate brokers to waive their rents. Certainly, their business needs support and they are looking out for rent relief packages. Restaurant owners association in Singapore has already solicited the landlords of restaurants and shopping malls to cut down the rents for the next three months by 50%. The market is becoming messier and it is becoming more difficult to achieve sales. Meanwhile, some business owners have been lucky to be given flexible rent packages and marketing assistance.
5. Residential real estate has been affected
A lot of people believe that the pandemic has no effect on residential real estate. Meanwhile, the effects are massive because people are afraid of investing in the residential sector of real estate. People are uncertain about the future and the trend in the economy. The number of home buyers has reduced; this is not strange owing to the fear that comes with the pandemic.
6. More so, the real estate economy has been greatly brutalized by this surge.
Everyone is pinned to their homes and investors are worried over what to do to save the alarming situation. Taking a peep into the surge, it is glaring that owners of real estate properties have been affected. Malls, shops, churches, hotels, mosques are empty!
7. Opportunities are usually created in the midst of uncertainties.
Already, a plethora of real estate agents is rushing to include their properties in the market list knowing that rents will definitely expire. People with existing mortgages are likely to achieve the refinancing of their loans while also negotiating to get the best mortgaging deals.
8. In the meantime, a plethora of business owners are struggling to remain in business.
In Singapore, some restaurants and malls are trying to open up and operate on a low key despite the pandemic. The number of buyers is extremely low. They have lost a lot, but they strive to recoup theirs loses by harnessing various channels for their product delivery. A lot of business owners are leveraging on social media marketing. Some restaurants have forged relationships with hospitals, Nurses and doctors. They have started supplying food directly to patients and health workers. At the moment, there is massive uncertainty in the rent industry as shop owners are struggling to save enough amount of money to renew their rents.
9. It would be best if estate investors used strategies that provide the highest dividends.
It is pertinent to note that in real estate, profits are accrued when a property is purchased. Going memory lane, it is true that people sell off their properties at cheap rates during times of distress and fear. You should be on the lookout to buy prudently during this pandemic. Try and review the deals that were too expensive in the past, as there might be an opportunity for you to buy at your desired rate during the pandemic. The pricing cycles are going down, so you should identify such assets and invest.
10. The COVID-19 pandemic has reaffirmed that no one can really predict the direction of the real estate market.
Uncertainties such as the pandemic can stifle the industry. At this juncture, the whole world is still waiting for a vaccine. Investors in real estate, buyers and sellers are waiting eagerly for the cure before resuming business. No one is pessimistic here, but everyone should be prepared for the worst. The recession is gathering momentum and assets could easily become liabilities during this pandemic.