How is Covid-19 Affecting the Real Estate Market in the New River Valley?
To say that all that has happened with Covid-19 in the past few months was unexpected is the understatement of the century. Who would have thought as the economy was humming along at an incredible rate in January that everything would be ground to a stop in March?
While it will not be possible to know the long term effects of Covid-19 on the overall economy and real estate market for some time, here is some information about how the pandemic is affecting the real estate market today.
Covid-19 and the NRV Real Estate Market
Housing inventory is down in the past month due to Covid-19 fears, however home values have remained stable. Home values are projected to remain stable for at least the next 6 months because of continued buyer demand.
For investor owners, as of April, 2020, we have just seen a slight decrease at Townside Property Management in the pace of leases being signed for the fall. However, even in the midst of Covid-19 we still have leases being signed for next year every day.
You might consider refinancing your mortgage. Rates are at historic lows and you could potentially save a substantial amount of money every month by refinancing at a lower interest rate. Fannie Mae projects that interest rates will continue to fall through 2021.
New Development Continues around the NRV
In Christiansburg on 114:
Stateson Homes continues construction on the Clifton Town Center, modeled after the Daleville Town Center in Botetourt that will feature townhomes, apartments, office space, and a hotel.
Fralin Homes plans to begin developing 9 acres near New River Village into 14 townhomes and 132 apartments that will be called Magnolia Pointe.
Takeaway: There will still be homebuyers and renters who want to live in a mature associations and neighborhoods with full grown trees and wider streets. Upgraded homes in established areas will continue to be highly desirable.
In Blacksburg
Multiple builders are developing hundreds of bedrooms of luxury’ student housing that are renting for $700-$1100 per person per month - most are fully furnished. Examples are Park37, The Retreat, and The Edge which are fully developed.
Terrace View on the corner of Tom’s Creek and Patrick Henry is under new ownership and going through extensive renovation. Jefferson St. Apartments on East Clay are adding 255 new bedrooms across 6 buildings that will rent for $400-$500/bedroom.
Takeaway: Many students will be priced out of the luxury market and will be looking for medium priced rentals that still offer some of the upgrades of the luxury units. The increased rent that older, but upgraded, units can get can make them a good value even in today’s market.
Conclusion
Even in these uncertain times, the real estate market has remained stable. There are less listings, but those still listings are still moving quickly for close to list price. Anecdotally, in the past week I listed a property, closed on a property, and am about to put 2 properties under contract - things are still happening!
However, there is uncertainty in the market, which can lead both to buying and selling opportunities for savvy buyers and sellers.
Continued, historically low interest rates make now an incredible time to refinance if you have an interest rate over 4%. The rates also create a unique buying opportunity - a lower rate essentially allows you to purchase a property on discount.
How are you feeling about the real estate market in the midst of Covid-19? I’d love to hear from you and help in any way I can!
If you have been thinking about getting into real estate as an investor or first time home buyer, with the extra time we all have on our hands, now is the perfect time to educate yourself to get ready to jump in the game when things pick back up. Please let me know if I can point you in the right direction!
Get in touch anytime - I’m here to help!
philipbowling@gmail.com // 978.473.0587