Although the new coronavirus pandemic is far from over, the real estate industry hasn’t stopped. When it comes to selling and buying properties, many things are still unclear. When the pandemic hit the US, the buying process changed practically overnight. Things like open house cancellations, volatile mortgage rates, and longer wait times are changing the dynamic leaving both sellers and buyers confused. All US states have been affected, including Texas. Texans are adjusting to social distancing and staying at home, as many of them try to cover their expenses with significantly lower incomes. If you are interested in buying a property in Texas during the coronavirus pandemic, you probably have many questions. Here’s what you should know.
How is the pandemic affecting Texas real estate?
Until now, Texas has been one of the most vibrant real estate markets, breaking records in terms of numbers of sales and median prices five years in a row. Its homebuilding industry has also been successful. In fact, Texas was the state with the highest number of building permits last year.
It is still early to say what the economic crisis will do to Texas property values and sales by the end of the pandemic, the duration of the crisis being a crucial factor. Future property sales and values greatly depend on what happens with Texans’ jobs after the coronavirus pandemic settles down. The housing industry directly affects the jobs of builders, laborers, real estate agents, movers, furniture makers, and many other professionals thus influencing the rest of the economy. The slowdown is already taking place, but the question is how long it is going to last.
Which regions will be affected the most?
Texas housing markets will be affected in varying degrees depending on the area.
According to experts, regions like Houston and the Permian Basin may be affected not only by COVID-19, but also by the decrease in oil prices. We are already seeing a decline in property showings and permits for new construction are also expected to drop. In Texas regions whose residents work in the energy industry, such as Houston or the Permian Basin, property sales and values are likely to drop more than in other regions. The same goes for the Rio Grande Valley, whose residents rely on cross-border trade. These regions will probably take longer to recover from the crisis, too.
We are witnessing that fewer people are putting homes on the Huston market. However, the values of sold homes have gone up. This March, new home listings of single-family homes decreased 4.8% compared to March last year, while home prices increased 3.6%.
The Midland-Odessa region is likely to be affected even more than Houston because smaller economies are less stable due to being less diversified.
Another area that will be hit hard is the border due to a decline in commercial trade with Mexico. Border cities (Laredo, El Paso, McAllen, Brownsville, etc.) will be affected because their economies weren’t strong before the pandemic, and the recession in the Mexican economy will only make things worse.
Tips for buying a property in Texas during the global health crisis
Taking the current situation into account, you may decide to postpone buying a property in Texas until the coronavirus pandemic has passed. But if you decide to proceed with the buying process, there are things you should know.
Choose a good real estate broker
Be careful when choosing a real estate broker who will facilitate the process of buying a property in Texas. To narrow your choice, read online reviews and conduct online interviews with the best candidates. Reliable real estate brokers are aware of the challenges the current situation imposes. Therefore, they are willing to go the extra mile to make sure their client’s needs are met. It is their job to help you have a fully-digital real estate transaction and a positive overall experience.
Try to be flexible
As a result of the global crisis, mortgage rates are changing frequently. They heavily rely on demand. Normally, when the economy is going through a crisis, mortgage interest rates decrease. However, the coronavirus pandemic is a new kind of crisis and mortgage rates are constantly changing due to the volatile market. Buyers should be aware of this and try to remain flexible.
Avoid physical contact
Some companies have the technology to offer virtual open houses and tours to avoid health risks. Buyers can have their agent walk them through a property while live chatting. This kind of technology is actually nothing new. Remote buyers have been using it for years. It is already well-developed and reliable. Although taking a digital tour isn’t the same as being there in person, it is in everyone’s best interest to stay home.
Many moving companies provide estimates in a similar manner to avoid physical contact. After doing a virtual survey of your home, they suggest moving options that suit your needs and offer you a price estimate.
Under normal circumstances, you would close on a property in person with a notary present. Right now, a fully digital online closing is a much safer option for everyone involved.
Start the process of buying a property in Texas early
Start working with your lender even before the seller accepts your offer because the process is slower than under normal circumstances. The process takes longer these days mainly because most people are working from home. Moreover, the influx of refinancing applications is overwhelming lenders. So, if you want to buy a property in Texas and move in by a certain date, contact a real estate broker and lender as early as possible.
Elizabeth Harding lives and works in Fort Worth TX, mostly covering topics related to real estate, relocation and storage. She currently collaborates with evolutionmovingdfw.com, a Texas moving company. When she’s not busy writing or taking care of her kids, he
