The Covid-19 pandemic has brought loss and hardship to millions of Americans, and millions more are fearful and uncertain about what the future holds. House flippers may find it difficult to focus on the silver linings in these dark clouds, but while the coronavirus has been wreaking havoc on the U.S. economy in recent weeks, fix and flip investors stand among the small businesses around the country that can profit due to abrupt changes in market conditions.
House Flippers Bring Like-New Options to a Tight Market
Yes, these are tough times, but households still have to function, and consumers are turning to businesses for help. Home delivery services, video conferencing platforms, online shopping portals, as well as manufacturers of niche products like headscarves, hand sanitizers and bidets are among the companies that are helping consumers to navigate the new norms brought on by the Covid-19 pandemic. Added to the list of the small businesses that are filling a specific need in these tough times are house flippers, who bring like-new housing options to the market for eager home buyers—many of whom are finding extremely limited inventory in their local real estate markets.
Mortgage Rates Today are the Lowest They've Ever Been
Prior to the emergence of Covid-19, 2020 was set to bring an incredibly competitive and lucrative housing market nationwide—with low inventory, low interest rates and high demand. Today, with U.S. mortgage interest rates at the lowest they have been in recorded history, new construction is at a standstill and many cautious property owners are refinancing or postponing listing their homes for sale and are staying put for the time being to wait and see how the economy rebounds. Home buyers who are able and eager to purchase a new home right now are finding extremely tight housing inventory in their local markets, and house flippers are poised to fill that need.
House Flippers Should Be Prepared for Longer Turnaround Times
Due to possible delays related to construction material supply chain issues, fix and flip investors should be prepared for possible delays in their project turnaround times —and there may be other Covid-19 related delays with your house flips as well. For example, home buyers will most likely be finding and touring your house flip via an online portal. Waiting for buyers to navigate these new online house hunting norms may add a few weeks of holding costs to your projects.
Having a plan B in place in case there are construction delays, or home sales are a bit slower than normal, is essential, but in many markets around the country, fix and flip investors who are able to wait a little longer for buyers to find their flipped houses are poised to provide much needed relief to eager home buyers while earning a good return on their fix and flip investments.