Raleigh is very fortunate to be one of few housing markets in the U.S. not yet feeling the dramatic, chaotic effects of COVID-19. Every day, data emerges showing total national cases, casualties, and predictions for the increase of each. We now know that, thankfully, social distancing and quarantine efforts have been working to mitigate the spread of the virus. While still chilling, our nationwide casualty numbers are lower than the predicted scope of destruction should it have been allowed to burn unmolested through the American populace. While the nation is not out of the woods yet, this new information has started to make me, and people smarter than me, think about what recovery will look like. Recovery? But didn't you just say we aren't out of the woods?Mark Frost in Twin Peaks wrote “there is no light without darkness.” We are, unarguably, living through a very challenging time in world history. Chilling images of Hart Island’s mass graves for deceased persons unclaimed by a next of kin make the rounds on the Internet regularly. By now, most of us know someone affected by COVID-19, be they a healthcare professional or viral victim. Recovering as a species, let alone as a nation, is going to be excruciating. I won’t claim to know what our recovery will look like, though I will claim to have some ideas. Those of us currently designated “non-essential” or able to work from home are in a strong position to take a holistic look at world conditions on a global, national, and local scale. This examination and careful consideration can perfectly poise you to support your community through prescient action and investment at just the right moments. Is it insensitive to look ahead to recovery from a profit-based position? Potentially. Will someone, somewhere be doing it? Absolutely. We wouldn’t be an end-stage capitalist nation if they weren’t. So why shouldn’t any prudent person? The American Pandemic FamilyWe are about to see a big change in how individuals participate in American society and interact with each other. A personal example that I’m sure many other Americans can relate to is the sudden number of text messages I’ve received from my parents requesting assistance with setting up various methods of virtual meeting, like Zoom and Discord. No longer are we getting in our cars and driving to a friend’s house once a week to drink wine and catch up on how the kids are doing. We’re on our own personal couch with our own personal bottle and we set a time to all chat via Zoom meeting. As people continue to live their lives somewhat socially distanced from one another, we are going to see an increase in value placed on the idea of home. You don’t need to be a real estate professional to understand that the lines out the door at Home Depot and Lowe’s every weekend is representative of people with discretionary spending power both stuck in their houses for unprecedented lengths of time as well as a growing frustration with all the imperfections they now have the time to stare at all day. DIY home improvement projects are much more popular than they were at the beginning of the year, and if a second wave of COVID-19 occurs as predicted, we’ll likely see a similar increase later in the year as well. After Hurricane Fran in 1996, every house that went on the market boasted “we have a brand new roof!” That’s great, but so did everyone else. They were all affected by the same disaster and responded the same way. Home sellers are going to see a similar saturation in the next 1-3 years when going to sell their homes. They’ll want to boast about how the paint is new, repairs were all performed meticulously by the owners, and the landscaping has never looked better (thank goodness for bored children). Again, that’s great, but everyone else did the same thing while we were stuck under a “stay at home” order. Investment as a Restorative PracticeIf you look around your immediate area in Raleigh, you’re more likely now to see signs reading “SPACE AVAILABLE!” on commercial/retail/restaurant buildings. Decreased patronage of these stores following COVID-19s reaching NC has put a lot of local business owners in dire financial straits. They no longer have the income, let alone the reserves, to put their money into worthwhile investment opportunities, like expansion of their business or purchases of investment properties. As the Triangle continues to wade through coronavirus, precocious investors should be looking ahead to what will be important to the recovery of their local economy. Commercial real estate is not going to turn a profit for a very long time, if at all, as social distancing continues to permeate our society. The same goes for apartment living; who would want to live on top of one another and increase their chances of infection while not having amenities like a yard? If you can put your money into something that will be important to the recovery process and do so before recovery even begins, you will be in that much more secure a position to ride out the next few years. It’s not comfortable to think of the COVID-19 pandemic as a matter of years. I don’t like it either. However, I’d much rather be prepared for something that never comes than be unprepared for something that does. With severely limited returns on most investments in the financial markets for an unknown length of time, a patient, intelligent, and attentive investor will put their money into residential real estate This is the only form of real estate guaranteed to appreciate during a virological crisis. City LifeOn April 7 of this year, I posted an article about iBuyers (Zillow, RedFin, OpenDoor, etc.) and how their updated business practices in the midst of COVID-19 will, and is, affecting local markets like Raleigh. If you read all the way to the bottom, you likely began to wonder about how a jam-packed city life used to appeal to some but likely won’t in the near, if not immediate, future. One attribute of coronavirus that most of us can agree on is that it spreads when people are near each other. People who previously loved city living because you’re in the middle of everything are going to start seeing that, in this age of indefinite pandemic, living so close to other potentially disease-carrying humans is no longer so appealing. On May 2, I got a notification from the CNN app on my phone which read: “Rethinking city life.” These are predictions about which I take no joy in my accuracy. I’ve lived in big cities (London & Philadelphia) and I absolutely adored my time there. I don’t want the next generation to miss out on the energetic big-city energy that I got to enjoy; the experience was a big part of my formative years and I wouldn’t trade it for anything. However, most of us have seen the chilling photos illustrating the devastating impact that mass COVID-19 death is having on the city. Refrigerated trucks being used as stopgap measures for overwhelmed morgues and mass graves for unclaimed persons are enough to inspire even the most ambitious, adventurous, and bold person from moving into a densely populated area. As the CNN article reiterates and as I said back in April, the American post-pandemic workforce is going to look more like remote workers telecommuting in to work rather than driving to the office from the suburbs every day. Catastrophe has a way of trimming the “fat” off of a society’s practices. An entire C-level suite of officers at a Fortune-100 company all telecommuting to meetings from their homes via Zoom was, previously, “unfeasible” or “impossible” to coordinate. Now, this type of practice is expected. As we continue to learn more about what life in the age of pandemic will look like, we will continue to see this “fat” trimmed more and more. Cubicle workers will be able to clock in from home with their own workstation and the office phone lines diverted to their cell phones. Law offices will conduct parking lot signings and adapt their cybersecurity to allow for secure digital conferencing between attorneys and their clients. Lowe’s and Home Depot will continue to be the place to be on Saturday and Sunday. TakeawaysIf you are fortunate enough to be relatively safe and stable during this pandemic, start thinking about how you’re going to grow your wealth and secure a financial future for yourself and your family. Unless the rules of our economy suddenly flip on their head, fiscal competence and safety will remain imperative to the average person’s quality of life. Residential real estate is full of opportunity, now more than ever.
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AuthorJessica Mohr is a licensed real estate broker working in her hometown of Raleigh, North Carolina. Archives
November 2021
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