Why New Orleans Millennial Real Estate Broker is Still Buying Real Estate During COVID-19

Hi! My name is Alex Lacy and I am the real estate broker for Nola Northshore Real Estate and I am still buying a house in the 2020 crisis known as COVID-19.

You must be thinking… ARE YOU CRAZY!?! Below is the logic I used when deciding to purchase…

#1. This is NOT the 2008 Real Estate Crisis

Don’t worry, I will tell you my reasons for buying in a minute. I think I must preface my story with a few facts.

Below are just a few reasons for what caused the housing bubble back in 2008, and I recognize that there were completely different factors that affected our industry and here are just a few points to remember:

Mortgage standards were drastically different.

Your financial background must be completely verified in today’s mortgage standards. Unlike in 2008, banks must verify employment, salary, assets, debts, and credit just to name a few. As a Real Estate Agent, I KNOW these background verifications are taken seriously. But back to more examples…

Home Appreciation is NOT out of control

Below is a picture showing 6 years leading up to the housing crisis compared to the 6 years prior to COVID-19.

We do not have a surplus.

Let’s go back to some basic economics. A surplus is the amount of an excess of a product or a supply over demand. The housing market is not in the same place.

As a Realtor, in addition to the home, I am buying I have THREE other listings under contract, and the agents that work with me each also have additional clients. ALL of our BUYERS still want to buy the homes!!! Shout out to my fellow Realtors that are helping. We are all renegotiating around this crisis and even coming up with ideas for Buyer’s who may temporarily be laid off.

WE at Nola Northshore Real Estate are working on solutions. I have written to the LREC (Louisiana Real Estate Commission) and to NAR (National Association of Realtors) for help and have already made some promising headway with the National Association of Realtors.

#2. I need a place to live in!

Okay, to be honest, I moved to New Orleans, from the Northshore for my husband’s job over a year and a half ago. My husband has never lived in New Orleans, and wanted to get to know the city before we purchased so we rented… I know a Realtor that RENTS! Lol honestly, we were newlyweds getting on our feet and we were still working through student loans and other things so don’t judge.

I won’t lie, we love our little Lakeview New Orleans shotgun rental as it helped us learn and experience the city better. After a few months, we knew we had to decide where we really wanted to live. After about 6 months of searching, earlier this month we found “THE ONE”! We put in an offer and negotiated and we were ecstatic with our low-interest rate and the home. THEN COVID-19 HIT.

Lately have all been bombarded with media hysteria. I will not lie- this made my husband and I question if this was the right time to buy our home. But, we didn’t cave into the hysteria. Instead, we asked ourselves a few questions and one was, “Do we need a place to live?”

The short answer, “YES”! Either way, once COVID-19 passes we would need a place to live. If we kept renting, our money would continue to be put in the landlord’s pocket instead of our own investment.

#3. The housing market ALWAYS Fluctuates.

The housing market, in my opinion, has RECOVERED from the 2008 market crisis and is steadily rising. If we look at the chart below, we see how it bubbled with home prices going up dramatically. Our home prices have been going up steadily since then.

The question is, “Will we see a dip in the Real Estate Market”? The answer… “Maybe”. The real estate market always dips different times of the year and some quarters are better than others. Look at the chart below, it does not have straight lines.

I expect this in the Real Estate Market, this quarter may have limited sales because we are abiding by the government’s request to self-isolate. But I tell you… I have had so many people still talk to me online and through our website that are still interested in purchasing a home. The demand is still here.

So our key question is, “Do we think we will be upside down on our mortgage if we buy now?” The answer is maybe in the short term, however, I don’t think as a Real Estate Professional that it will have long-term effects outside of our goals. We plan to live here for the next 3-5 years.

Do you think we’re crazy for Buying our House? Call me and we can talk about it… we’re stuck at home anyway! 985-807-1117.