Economists who track home price appreciation are stunned by the statistics for 2020. Even in outlying suburbs and semi-rural areas, prices for large, detached houses have escalated dramatically since COVID started.
“Strong demand drove intense competition among buyers -- causing homes to fly off the market. Housing market gains were the biggest in 15 years,” says Zillow economist Treh Manhertz.
Moreover, housing analysts predict that given the severe shortage of available properties, the price increases will only accelerate this year. That’s one reason more house-hungry buyers are now pushing the geographical limits in search of a spacious property they can afford.
“COVID is causing many young families to change their priorities. People who once craved city living are now open to owning in the deep suburbs if they can find a huge ‘forever house’ with all the bells and whistles,” says Stacy Berman, a veteran agent who’s sold property since 2002.
One reason families now wish to upsize is that during the pandemic they’ve experienced the space constraints involved with crowded family living.
“Many parents are now working from home. In addition, the kids are home all the time, with the older ones attending school from their bedrooms. Space and privacy are very limited, which is frustrating,” Berman says.
The closure of many gyms during the pandemic has caused more people to develop home-based fitness routines. Also, many families have recently adopted a dog, which calls for a large yard where the pet can romp.
Eric Tyson, a personal finance expert, says buyers considering properties in outlying areas are also looking for affordability.
“Typically, the further outside a metro area that you buy, the lower the cost per square foot of living space. That’s what real estate agents mean when they say buyers 'drive until they qualify,’” says Tyson, co-author of “Home Buying for Dummies.”
In the COVID era, he says many families want to upsize their housing with a spacious place that features an oversized kitchen, multiple bedrooms for home offices and a yard large enough for weekend volleyball.
Berman tells the true story of a couple in their 20s with a young baby who recently retreated from an urban lifestyle in Manhattan to buy a farmhouse in rural upstate New York. Despite the major change, they’re assuming the new lifestyle will please them indefinitely and that both parents will be permitted to continue working remotely for their New York-based companies.
But Berman cautions buyers against short-term thinking.
“Before you commit to a house in an outlying area, make sure your employer will let you keep working remotely after COVID. Otherwise, your commute could prove impossible,” she says.
Here are a few other pointers for pandemic-period buyers:
-- Commit your lifestyle plans to paper.
Where you choose to live has countless implications, says Doro Kiley, a certified life coach who’s helped a number of clients navigate real estate transitions. She urges clients to make a home choice within the context of their overall life plans.
“Always begin by thinking about the end product -- what you’d really like as opposed to what you would settle for,” Kiley says.
Once you have a clear vision of your ideal home and location, you can begin taking into account such practical realities as financial limits and commuting distances.
Kiley recommends that couples planning a home purchase first write down their respective visions of a dream house -- including both location and home features. They should then share their visions, combining the key elements of both into a single statement.
-- Factor in the realistic demands of a large lot.
Many people with young children hang on tightly to the hope that their kids will have a large backyard where they can play, just as they did years ago. This aspiration can influence them to pick an outlying area at the expense of their convenience and commuting time.
But are the tradeoffs necessary to acquire a large piece of land always worth it? Not necessary, says Merrill Ottwein, a Coldwell Banker broker, noting that in the post-COVID period, children will likely spend more time in organized athletic and recreational activities than did their parents.
-- Take your time when selecting a property.
Nowadays, those seeking a home in many popular areas face fierce competition from other bidders. They feel pressured to act quickly, lest they lose out to a rival. In the process, Ottwein says some buyers are now taking regrettable shortcuts -- rushing into a purchase without analyzing whether the property they buy truly matches both their primary wants and needs.
“With so much at stake, it’s a horrible idea to buy any house before you’re really ready. Don’t let your competitive instincts trick you into the wrong choice,” he says.
(To contact Ellen James Martin, email her at email@example.com.)