Property industry expectations
Hi Everyone, it's Ed.
In recent weeks we have seen a series of economic expectations being updated from a sucession of surveys. In fact the outlook from the impact from the COVID-19 lockdowns has worsened gradually during April.
So, what is expected to happen to the property market in general and what are the (financial) effects for Buyers, Sellers and Intermediaries.
Probably a confirmation of what many would expect but still some interesting results.
Quite a few major intermediaries worldwide participated in these surveys conducted by Online Marketplaces and it is evident that 95% is currently working in a lockdown environment whilst 70% is in full lockdown.
The latest report shows that around 75% see a significant negative impact on Home sales durng March-April and most others a slight negative impact with only a few percent seeing a slight positive effect on sales.
Nearly 10% of intermediaries see a significant negative effect on prices whilst 55% mention a slight negative impact. About 35% see no impact on prices as yet.
- Not being able to connect due to travel restrictions
- Buyers are awaiting further price developments
- Completions are being delayed due to travel or social distance restrictions
- Sellers are taking homes off the market
- Issues with financing home purchases.
- Distressed sellers take initiative to lower asking prices
- Developers of new homes have excess stock
- Some oversupply in the housing market in several regions
The next 3 months
About 50/50 between respondents expecting home sales to Decrease or Increase. This shows how uncertain everyone is on the outcome and a possible 'New Normal' put in place.
20% expect a strong decrease in prices with 65% a slight decrease in house prices. The larger balance of 15% for no change or a slight increase.
Industry Loss / Change
80% of respondents expect to either see a fairly sizeable or slight decrease in total members in the property industry. This is a big number and time will tell of course how much fat there is to keep businesses afloat after several months of lock down with less or no income.
Just over 50% of businesses are still closing transactions and so have a few of our partners this month. Property business are rapidly adapting to the changing conditions by improving on IT solutions.
Interesting is that nearly 70% of respondents expects the property industry to change business models and operations. Consider more online viewing, online completion of transactions, more processing efficiency, more remote working and a more centralized service by the larger players in the property space.
Looking forward to hearing from you!
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