So we're in the middle of a shitstorm, one that only those with the wildest imagination could have predicted. A few short months ago the stock market was making record highs and real estate was on the move up across the country. We're in a different world right now.
Things are very bad and they're not going to get better for real estate anytime soon. We're most certainly heading into a protracted buyer's market. So if you're currently looking to purchase, you've won the market timing wheel of fortune. This is not the time to sell, unless you've got the proverbial gun to your head. No different than trying to sell equities into a bear market, keep calm and carry on.
This is not the end of the world for New York City real estate, although it might feel that way, ignore all the noise from the haters and the armchair pundits. History teaches us that the world has survived pandemics, wars and pestilence since time immémorial.
Just like I've held stocks for years through bear markets, you should have the same mindset about real estate and not panic sell.
As bad as it seems, the fact is approximately 99.5% of people that contract covid-19 are going to be fine according epidemiologists. There is a path to getting out of this.
I recognize that this is a different animal, we are in unchartered emotional waters. However, just like we saw with the AIDS crisis, medications will be developed that will be game changers for this virus. And just like with AIDS, there will be a new normal and different behavioral patterns that emerge. And before you get your knickers in a twist about comparing this to AIDS, I'm simply talking about the ability of scientists to create treatments against this virus.
What now?
If you're a buyer and someone that's committed to wanting to continue living in New York City, be patient and set up those searches on streeteasy. This is the time to make aggressive offers, fear is in the marketplace. Sellers are going to have to decide to accept an unpalatable bid today or perhaps take less 3 months from now.
If you're a seller that absolutely has to sell, it's time to get real. Your apartment is probably worth somewhere between 5 and 20% less than it was on January 1st, depending on what you own and where it's located. We've essentially lost the spring, that said I think we could potentially see an uptick in buyer activity in July and August. Why? If covid-19 activity continues to quiet in the city and things begin to open up, July and August could become the new April- May, for this year anyway. Of course I'm not talking about April- May traditional activity, but I think you get the point.
The bottom line is buyers and sellers can't both be happy at the same time. So just hang in there, stay healthy and be smart. The game changer will be when you can get a shot or take a pill and simply go on with your life without fear. When that happens, and it will, things will indeed get back to normal!
Keith
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