COVID-19 has had an unmistakable impact on the housing market, slowing transaction volume nationwide. A new study published Thursday by real state technology company OJO Labs found that 80 percent of homebuyers planning to purchase in the next six months have had their timeline delayed or halted altogether.
“Buying a home means gaining more control over one’s living and financial situation — an important milestone,” the survey reads. “But many buyers are delaying this next step because their financial future is so uncertain in the wake of COVID-19. Until they have more certainty about employment, house dreams are on hold.”
OJO Labs, the company behind the AI-powered virtual assistant tool OJO, surveyed 200 homebuyers that had planned to purchase a home in the next six months, and subsequently conducted video diaries with 10 select participants.
“We found that the virus has amplified many of the existing difficulties along the homebuying journey and made apparent the value of both technology and human expertise,” the survey reads.
The survey found that 60 percent of first-time buyers cited concerns over future employment prospects and 54 percent cited an inability to see homes in person as the reason for delays.
Even with the inability to see homes, there aren’t a lot of homes hitting the market, according to the survey. New listings are down 28 percent from March peaks in 60 OJO markets.
“Even if they found a few viable options, they can’t go see them because it’s uncertain as to what’s allowed in ‘shelter in place’ markets,” the survey said. “Relying on virtual tours and photos for a purchase this large is simply too risky. They don’t want to get catfished because photos and videos lie.”
An estimated 20 percent of homebuyers are expediting their home search but repeat homebuyers expediting their search are turning to technology. An estimated 35.5 percent are finding chatbots more valuable, 41 percent are finding virtual tours more valuable and 35.3 percent find video conferences with agents more valuable than before COVID-19.
Prospective homebuyers are also placing value in different areas. Consumers are looking for more space and larger common rooms.
Expedited first-time homebuyers are putting greater importance on finding a home that is within their price range, has a nice kitchen and has good lighting. Expedited repeat buyers, however, are putting the greatest emphasis on location and accessibility. Price, in general, is key, with many lowering their target price range in case of another pandemic or recession.
“They want to be able to afford their home if this happens again,” the survey says. “Price is becoming more important.”
“Buyers are making sure they can afford the homes they’re currently looking at, and some are even lowering their price maximum so that they feel confident they can weather any future uncertainty,” the survey continues.