COVID-19 added to what buyers want in a new home
By KRISTI BAILEY
There’s no such thing as the lazy, hazy days of summer in real estate. At least not this year, thanks to COVID-19. Shelter-at-home curbed the traditional spring home buying and selling season for a couple of months. At the same time, it increased pent-up demand, made many buyers optimistic about buying a home, and raised the bar for what buyers want and are willing to pay. REALTORS® are busier than ever keeping up with the demand.
“Homebuyers remain steadfast in the main attributes they seek – three bedrooms, two bathrooms, and a garage. However, the quarantine has made people rethink where and why they want a new home,” according to Realtor.com’s Senior Economist George Ratiu.
We see increased effects from the “where they want a new home.” The number of people relocating to our area is growing. That is a shot in the arm for both the local housing market and a boost to local economies. Each new resident accounts for a little over $40,000 a year in spending on local services and products. Since our population is rapidly aging, and the local death rate is higher than the birth rate, attracting new residents keeps our population base on a somewhat even keel.
A new survey by Realtor.com found three-quarters of the respondents say they are looking for larger homes in more expensive neighborhoods, using lower mortgage rates to stretch their budget. Others opt to pocket the savings by decreasing their monthly mortgage budget. In addition, home shoppers are willing to live farther away from their workplaces to find the right house. Locally, the commute is not as much of a factor since many of the new residents are retired, semi-retired, or remote employees.
The number of local commuters and remote workers is also on the upswing. It’s enough of a trend that TVA Economic Development Board tapped Erwin as one of seven communities for a new remote ready work program. The goal is to stem the outflow of young peoples. The study that moved Erwin into the program also touched on something near and dear to real estate professionals. It said that the 2,900 daily commuters come to Unicoi County but do not stay because of the lack of affordable housing even though there are 110 empty parcels of land and 26 vacant buildings ripe for redevelopment.
So what has changed? The starting point remains three bedrooms, two baths, an updated kitchen, and a garage for those who responded to the Realtor.com survey. Since COVID, buyers are also now adding large backyards, updated bathrooms, and pools to the list. What buyers are willing to pay has also shifted. Before the pandemic, homes under $200,000 were 42% of searches; that number has now dropped to 38%. While much of the new buyers want are available in new homes, it also gives existing home sellers insights on how to improve the marketing of their properties. Keep doing those updates to get the most for your home.
NETAR is the voice for real estate in Northeast Tennessee. It’s the largest trade association in Northeast Tennessee, Southwest Virginia region representing over 1,350 members and 100 affiliates involved in all aspects of the residential and commercial real estate industries.