Job Losses and the CoronaVirus

How will job and income loss affect the Real Estate Market

Job losses and income reduction are already happening in most of the economy

Job losses and loss of income in general are scary, but they’re real and they’re happening all across the board. In the meantime, there are companies which are hiring, rather than firing.
E-commerce, delivery, shipping and trucking, healthcare of course, grocery stores and those involved in producing and supplying essential goods and others.

Aftermath

When the dust settles, jobs are going to be coming back, surely shuffling around with many career restarts and change of positions. Most jobs will likely be absorbed by a resurgent economy.

The Residential Real Estate Market
Some businesses are hiring and may absorb some redundancies, in the short term and, in part, in the longer term

In Real Estate this means that many who want or need to buy a home, will have to figure out how to fund a purchase without qualifying for a traditional mortgage for insufficient employment history.
Additionally, if they had reserves and burned through them to get by during these tough times, mortgages requiring a significant downpayment may be out of reach.
Even the modest downpayment requirements of 3.5% of an FHA loan may be tough to meet, especially when it’s on top of all the other criteria of eligibility.

Impact on HomeBuyer Activity

Will this impact the ability to sell? Will the pool of buyers who not only want to buy, but also are able to buy, dry up significantly?
It’s always a matter of price, if the price is appealing enough, then there will always be a buyer.
There may be many more cash investors who are already setting cash aside and quickly liquidating assets, including on the stock market, but soon also bonds, to take advantage of a difficult situation for sellers.

Cash Buyers
Businesses are forced to layoff or furlough

They buy at a discount and never at a premium, so sellers who need to sell may have to take a hit. Not ideal. It may work in extreme circumstances where the property is in physical distress and/or the seller is under intense pressure to dispose of the home and the selling price is not the main priority.

Rental

However, there are other options that sellers can entertain, including renting. It could mean income that could cover carrying costs until the market restores to better values, but they would have to be landlords. For good reason, many don’t want to be involved in rentals, nor do we.
Alternatively, they can sell in one of the many more ways that the law and the market allow.
That’s when we come into play, as investors on terms.

Proxima Investors are Residential Real Estate Investors on Terms
Investors on Terms

We use any method which federal, state and local laws and regulations allow to achieve the sellers’ goals by buying the property at full or close to market value.
At the same time we sell the same property primarily on a lease-option or owner financing deal. We therefore allow time for the buyer to get in position to obtain a traditional mortgage or any other way of financing the formal purchase; or we may finance them.

Opportunity for Sellers


Sellers relinquish all responsibilities and headaches from carrying the property to us, they don’t have to sell at a discount and get it done with professionals like us involved. They can move on without any burdensome debt which hits hard month after month. They will have no more worries or miss out on market opportunities.

If sellers want a head start in this fluid market they should get in touch and find out about the details.

Real Estate Agents & Brokers

Agents are also encouraged to reach out and get accustomed to our model; our options would allow agents a powerful marketing tool for all sellers. We have homeselling solutions where there isn’t an easy one, as in a home in preforeclosure.

Listings hard to Sell
Get listings and get them sold no matter how hard the sale is

We can buy many of the homes that are hard to move. Agents would earn a commission, get credit for a sale, and with little or no work as we can handle the whole transaction.

Guaranteed Brokering Fee

If there’s any doubt that sellers may have issues paying the facilitating agent, we GUARANTEE any shortcoming or the full payment at the closing table. We understand that agents should get paid fairly and timely so we can get generate business and establish a steady relationship.

Sellers, Listing Agents, Buyers’ Agents
Any Real Estate Agent can assist us in completing deals on terms, buying and selling residential real estate

So sellers and sellers’ agents, CONTACT US to find out if and what solution we may have for you and your client; buyers’ agents also, if you have a buyers with any lending challenges, especially if they already failed to qualify upon application, ask us how we can make them successful home buyers.

All Over the USA

We team up with other investors on terms like us or agents and brokers when making deals outside of New England. We are therefore not restricted geographically and buy and sell all over the US.
We look forward to getting the ball rolling with anyone who needs to get a deal done!

Based in New England, we create deals in all states, albeit partnering with local investors and/or agents.

Home Buyers and the CoronaVirusOutBreak

Home buyers in the coronavirus outbreak
If you’re on the brink of making your dream come true, don’t hesitate any further!

Should #HomeBuyers wait it out?

First, let’s remember that:
There HomeBuyers who want to buy and HomeBuyers who need to buy.
There are HomeBuyers who want a new home to move into and live there, then there are Investors who want an investment property rather than their home.


Now, assuming homebuyers have not made a definite and enforceable commitment, because that would have to be completed or there could be negative consequences regardless of the outbreak;
assuming also that they’re buying a home that would work perfectly for them and their families,

then absolutely go ahead and don’t lose the deal!

If they wait, it’s going to be difficult to get back in. The discounted price they’re hoping for isn’t guaranteed to be available with low inventory and low rates, which now, can’t go much lower for them anyway.
Some other buyers may be able to get in more quickly and secure that house that worked so well.
Sure, many homebuyers are going to lose their jobs and spend their cash reserves, but there are so few homes available for purchase and not that many more after the virus outbreak and possible disruptions in the supply chains. Low inventory is going to outlast the virus!
Even if there are going to be fewer buyers, there’s going to be more cash because of the lower rates and possibly what was taken out of the stock market. Bonds are safe, but when things settle, they are going to be too dull and boring for investors. They are going to eye the traditional solidity of the real estate market.
Other investors are setting cash aside to jump in later and actively look for rehabs, upgrades, rentables and so on.
That would mean competition, and if it’s strong enough (it will be for good homes), there could be bidding wars that will soon drive prices back up to where they were, with the added hassle of going through a much more stressful process, especially for non professional homebuyers. Avoid getting caught in the middle of a war when things normalize and all buyers jump in. Non pros are at a disadvantage anyway.
Conclusion: “Buyer! If you’re on the fence, about to jump, but have one last moment to think and stop, don’t.

Home buying opportunities after the corona virus pandemic
Don’t put your dream at risk, go ahead and make the decision you really already made.
Don’t get distracted and regret it.

Buy!

If it’s NOT an investment and instead you’re moving in, BUY!

In a few years you’ll understand why it was a good idea.
If you’re hesitating because it may not work for you, then yes, it makes sense to wait, but don’t be cheap, don’t be greedy, don’t be opportunistic because it could come back to bite you and you could regret it. It could be a home that you will never be able to buy again…

PS: Given the circumstances, there may be delays in the process, as professionals, authorities, institutions deal with the outbreak, so don’t be impatient either.

What are Real Estate Investors doing?

Real Estate Transactions during the Corona Virus Pandemic

Investors and the CoronaVirus Outbreak

In GENERAL

Unlike other categories of professionals involved in real estate transactions as acting parties, investors have many different focuses. With focuses strategies can vary greatly and therefore they don’t face the same challenges as, for instance, real estate agents.

REAL ESTATE AGENTS

Agents and brokers tend to focus on traditional sales and rentals, a few specializing in smaller niches like short sales, but most get hired for straight sales or rentals.

REAL ESTATE INVESTORS
Selling and Buying Homes during the Virus Outbreak in the US

Investors may wholesale, rehab, buy and hold. They may be small private landlords or companies with large portfolios. There are also investors on terms and there are pure speculators, builders and developers and many more types of investors involved in real estate transactions.

ADAPTABILITY

Most investors are naturally able to pivot and switch strategies to adapt to a different environment with different challenges and opportunities, depending on the investors‘ specific expertise and inclination.

Business Discussion Talking Deal Concept

Every situation offers different challenges and different opportunities which require different approaches and solutions, especially in real estate.

For sure there are going to be different opportunities as the markets react to the situation created by the coronavirus pandemic. In Real Estate, investors are probably going to be very active, selling to liquidate and raise cash and buying as some homeowners may need to liquidate themselves.

PROXIMA INVESTORS

We’re investors on terms, we will gladly work with sellers who need to sell faster, cash out more of their equity and be able to move on swiftly.


We will also proudly help buyers who need time to secure funds for a purchase, to move into their permanent home right away, which is s important for families nowadays.


There could be issues for many employees whose employers have been hit by the outbreak and even if they would hopefully hit only a small part of the economy, some may have to decide to sell, while others may not qualify for a mortgage due to job loss, downgrade or change.

MERS-CoV Novel Corona virus and the Real Estate Market: Investors


Or maybe they are forced to use savings as emergency funds and not towards a purchase or receive a hit on their credit. We could proudly help all of those sellers and buyers by buying and selling on our specific terms, which are non-traditional, but get the job done.


Home Sellers would efficiently achieve their goals of selling and/or cashing out equity. Home Buyers have the time to secure the funds for a purchase.


Hopefully the impact will be minimal, but if it is, we are going to be here to help like always.
Sellers would have many more and better options enhancing their chances of a successful sale, buyers would have a way to buy and become homeowners or acquire a property that works better very quickly, even without all the funds and/or a dented credit.

IN SHORT

Real Estate Investors are going to be busy!

CoronaVirus in Real Estate: Buy or Wait?

COVID19 & Real Estate

Should I buy or should I wait?

I wish there was a straightforward YES or NO answer for all buyers. It’s not so much about the property or the market, it’s about the homebuyer.

Questions:


Why purchase? What are the goals and what numbers would work? Would the buyer want seek and close a complicated deal just because it’s the best? How motivated are they to exit their current situation?
These are the questions that prospective buyers need to ask themselves to find, not so much the possibility of a better deal. And if they are moving in, it’s very different than investors.
There are some pretty clear factors to consider; low inventory and low interest rates, paired with low unemployment and rising wages. They all require to be proactive facing motivate buyers as competition.

Virus Outbreak

The choice would’ve been pretty clear. A massive dose of uncertainty jumped into the Real Estate Market at the worst time.
Then the Corona Virus Outbreak struck, now Pandemic.
And right at the worst time; the Spring season was about to kick in with all its frenzy of activity, more listings, more buyers, agents superactive and so on.
It now becomes a matter of guessing what can happen. There’s just too little info, and not relevant to the specifics of the USA.
We know that, as of now, it’s going to get worse, with travel and gatherings greatly reduced, which could directly impact open houses and that would be pretty evident; however, there are a few thousand open houses scheduled around our area, in New England, and I don’t see many cancellations.
Agents seem to want to push through, hopefully with reasonable precautions (maybe they bought sanitizer ahead of time!).

Active Buyers

Surely some buyers are going to put it off, but there is a lot of motivation thanks to the low rates of mortgages and a lot of eagerness to get a deal due to high competition in a market with such few homes available to purchase.
Unless extreme scenarios materialize, there should be great activity over the weekend, barely limited by the coronavirus pandemic. After all, it could be sensed as an opportunity to beat the competition.

Bottomline


If you’re in it to win it, there’s competition and I wouldn’t wait to make a move; whether the pandemic is going to be short or long, inventory is not going to increase, while rates are probably not going to change much.
Jobs are going to be back on the rise again, with a only few dents here in there like in the hospitality and travel industry (airlines may never be the same).
It’s true that some may suffer the situation more than others and more could end up having to sell and at great conditions for a buyer.
However, it’s going to take some effort and prowess to find them because there’s going to be competition and I don’t believe that it will be a widespread situation and the government will probably step up and assist in some way.
Buyers should stay on top of the news and look for signals, but don’t hesitate to purchase the property you like and the numbers you like. Don’t overpay, but don’t worry about not making the most of the opportunity, the market will grow and you will have the home you wanted.
Keep in mind that many other real estate activities may be hindered and delayed, especially if they involve government institutions like courts and registrars and anything involving travel and meetings in person.

Conclusion

So, very generally speaking: BUY, leave the non-buyers, non-action takers, procrastinators, greedy for a slightly better opportunity later, leave them all behind!

Caveats

And never forget that real estate is local, and most news and numbers that are in the public, are national or regional at best. When you’re deciding, that matters.


That’s just our opinion at Proxima Investors. Good luck!