May 11, 2021 01:57 AM EDT
Will Buyer Demand in University Cities Improve After COVID?
Students of all ages have had to adapt to remote learning because their schools were closed due to COVID. People have had to make due with working at the dining room table or sharing office space with other family members. We all have had our fair share of quarantine fatigue and we're ready to get back to some semblance of normal. So far, 198 million people have received the vaccine in the USA.
Businesses had to close down and students who relied on these businesses for employment or to shop no longer can do so. Therefore university cities have suffered. But, as more people get vaccinated and things start to reopen, could buyer demand in university cities increase or will demand continue to decline?
It's a strong seller's market
According to HomeLight's Q1 survey for 2021 reveals that 97% of real estate say it's a strong seller's market, despite home prices being on the rise. Buyers are coming out in full force and are buying houses faster than houses are being put on the market.
This means that homeowners in university cities can sell their homes and not worry about getting an offer. Why, 94% of agents are seeing bidding wars break out because inventory is that low.
Demand for rental properties could increase, too
It's not uncommon for people who are buying these properties to turn them into rental properties. As universities reopen, student demand for rentals very well may increase as well. This is especially true for students who don't want to live in a dormitory because they want their privacy and autonomy.
One caveat of this is that the rent for these homes could be higher than it would be to live on campus. But, on the flip side, that cost can be split between several roommates. They could even save money by opting for renting with roommates.
Inventory continues to be lower than expected
Housing has always been a problem in the United States, but it's even more of a problem now because inventory is so low. There are so many buyers entering the market, some worry that if sellers continue to not list their homes for sale and inventory isn't replenished, the number of available houses will run out and then where would we be?
Fear not dear reader because 84% of agents remain optimistic that things will improve during the spring and summer.
Investors look outside of the box
When housing is in such short supply, investors are thinking outside of the box when it comes to finding investment properties. One group, Pebb Capital, purchased dormitories from struggling universities and turned them into apartments. These apartments are sought after by students and white-collar employees alike. As more rentals become available, businesses are likely to reopen. As businesses reopen, the economy will strengthen and it'll only be a matter of time before people will want to buy property in or near university cities.
If you're someone who is hoping to buy a home in the upcoming year, you should expect to pay more for a house than you would say, a year ago - despite interest rates still being so low. But, things aren't so bleak because the majority of real estate agents (93%) who participated in the survey say prices are going to rise in their markets.
Demand for housing in university cities could soar
This is the perfect time to sell your house, simply because there's such a huge demand, not to mention that housing prices are on the rise and bidding wars are erupting all over the country! If you're a first time seller or if you don't know whether you should sell or not, don't hesitate to contact a real estate agent for advice.
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