Mortgage rates have experienced fluctuations since the onset of COVID-19, and are currently at historic lows with expectations of even lower rates to come.
A study done by Zillow evaluated the impact of previous pandemics on housing markets, and one interesting thing it found is that home prices largely held steady or suffered only minor declines. This is primarily due to fewer transactions, and as such, not that many homeowners who had to sell at a loss.
While homeowners should prepare for a possible drop in home values, it’s not yet time to prepare for the worst. The housing market tends to hold value, while the stock market swings wildly so, for now, homeowners should wait to see how things play out.
“The reality is that home prices do tend to fall during economic recessions, but the extent to which that happens can vary by local market. In areas of high demand, homeowners may not see their property values go down at all. And with mortgage rates being so low, prospective buyers whose income doesn’t take a hit in the coming months may try to capitalize on that opportunity by purchasing property sooner rather than later. Get enough interested buyers, and suddenly, that demand alone can help ensure that should you decide to sell your home, you’ll command a decent price for it.”