When the pandemic started to hit last year, everything ground to a halt when markets and businesses shut down. It is a concerted effort to stop the spread of the virus. The negative effect is that economies were effectively threatened, with many people losing their jobs and businesses closing for good.
As bad as it sounds, some stand to make the most out of these closures. Some people have managed to keep their jobs while staying at home. The recession is also reminiscent of the 2008/2009 global real estate crash, where real estate prices went down by 50% or even lower.
It’s a good time to be a real estate investor right now. As you anticipate the right time to buy properties, here are tips to further help you to become an investor while staying at home.
Look into Markets Trying to ‘Survive’
Everyone’s trying to survive while under some form of lockdown, but markets are trying to get back up after the resumption of some form of buying activity. These markets are ‘survivalist’ markets, where the pandemic could not thrive. These properties are considered off-grid and can sustain themselves indefinitely.
Areas like Belize and other far-flung countries can benefit from this ensuing craze. There are also some places in South-East Asia where properties like this can be found.
Name Recall Will Always Be King
Be it in marketing or relationships, there’s something about a name. Certain names are easier to remember as there are brand names that will always be remembered best. In the long term, brand-name markets will emerge among the fastest to recover from the market crash caused by the pandemic.
An example is the market situation in Paris. Paris suddenly became a go-to destination of Brexiters who were moving away from London. There are still listings available on the market despite the lockdowns in Europe — Paris included — but there have also been very few withdrawals of entries. It is expected that when the country re-emerges from its lockdown, there will still be an interest in listings made.
With Travel Restrictions in Place, Vacation Markets Will Suffer
Think of how everything went down last year. With lockdowns happening, places like Cancun and Playa Del Carmen in Mexico suddenly became ghost towns, with rent and tourist traffic depreciating. Those places benefit from name recall, so they will be included in the wave of re-emergence to happen after the lockdowns. But there are far-flung areas that may suffer.
The very reason they’re going to struggle is also why you should carefully invest in these markets. Some of these places are tightly packed cities. With the crisis being bought on because of people infecting one another, most vacation renters and second-home buyers will instead choose to go to other places. There are bargains to be had because of this, but if you plan to invest in these crisis markets, think for the long term.
Investments in Foreign Markets
You can also look at foreign markets if you plan to invest. This might be difficult post-COVID-19, but it isn’t impossible. The trick here is to buy low and rent high. Some markets, like those in Southeast Asia, are relatively more affordable compared to other Western markets. A substantial return can be had in these places if you rent out your properties here.
Some places may require a lump sum payment for a property. In the region, there are places where only a small down payment is required, to be followed up by multiple (small) monthly installments. That’s where you stand to save big.
Look into Low-density Cities
There are some places in the world which has low to modest populations that are livable. These will also experience a sudden boom, undoubtedly because the crisis doesn’t look as terrible as it is in other places.
A low density means fewer changes for contracting the virus. Most people will have memories of this current pandemic on their minds for a long time, well after this blows over. These people will likely look for cities that aren’t as crowded, and rental properties or homes will be much cheaper in the meantime. You should investigate buying from these places while the pandemic still affects the market.
If you’re one of the lucky few who managed to hold on to their job and income even during the pandemic, you should look for a second income. When rented out, these properties will give you a passive return that you shouldn’t work hard for. Look into buying properties wisely as well, so you won’t eat into your savings.