State of the New Orleans Real Estate Market: Part II
State of the New Orleans Real Estate Market
As of Friday April 17th, we are hovering at the 30 day mark of being under a “Stay At Home” order in New Orleans, Louisiana. We’ve been monitoring the shifts in both macro and micro Real Estate markets.
Sarina Mohan, Director of Public Programming and Events at the Preservation Resource Center, moderated part II of a webinar speaking to the state of our current market. Three panelists with insight into Lending, Commercial and Residential trends spoke about what they are seeing and projecting for the New Orleans area. If you’d like to listen to the conference, click here.
First panelist to speak was Joe Uzee of Gulf Coast Bank & Trust. Joe has partnered with the Witry Collective as a guest speaker during our bi-weekly Buyers/Sellers video conferences and is a familiar face for the Preservation Resource Center’s classes. The good news Joe has to share on this call is about the current interest rates hitting a stable stride. Even just two weeks ago there was uncertainty in the market trends, which gave buyers low confidence in their decisions and timing. Current rates are sitting at a 3.3% on a 30-year fixed loan. The bad news? Guidelines have become a bit tighter on lending dependent on your credit score and proof of income. With 22 million unemployment claims in the U.S, banks need to take extra precautions to verify up to date paperwork for borrowers and may be raising the credit score requirement to 700 and up. In addition, forbearance rates have risen given the circumstances from a typical .23% to a whopping 4.1%, creating a rise in Private Mortgage Insurance or PMI loans.
Joe, being a “glass half full” kind of guy, says although we can expect delays and some slowing, we are seeing great advances in our approach to technology for the client via E-signing and more online communication.
Next up, panelist Gordon McLeod of McENERY Realty, spoke on the Commercial aspect. Gordon jumps in touching on the efforts our Real Estate community has taken to work together and how proud he is that even the banks are assisting with SBA applications. As for Commercial insight, Gordon has seen some extensions on contracts that were majority Hospitality…to be expected in our city that thrives on Tourism & Hospitality. The silver lining though, all this shifting may assist in getting an expansion of the Historic Tax Credits and we may be able to approach with better arguments.
Currently, the Commercial market in New Orleans shows roughly $39 Million in contracts. He sees an upswing of trend in attention on Multi-Family/lower income properties, with new/existing restaurant space coming to a stand still. Gordon does see opportunity for some though, like Healthcare and Tech employees, assisting in “buoying” the market.
Final panelist, Katie Witry of Witry Collective, also a Board member and educator for a variety of Preservation Resource Center classes, spoke to the Residential market. Witry Collective has adopted a variety of precautions for our Buyers and Sellers during this crisis. Agents are taking on responsibility to sanitize both themselves and the property prior to a client viewing. They are armed with the right gear (ie; wipes, hand-sanitizer, booties to cover shoes, gloves, etc) maintain physical distancing during closings, clean surfaces before/after showings and have adopted the Virtual Tour options for “Open Houses” of our listings through the MLS. Vacant homes may have more opportunity for attention at this time, something to be aware of as a seller.
We are still seeing a market for serious buyers, it seems the last ten years may have been more generous to a sellers market, but the shift is upon us with the “Stay at Home” order. More people are looking, more people want to have ownership. We should see more affordability in housing which will attract more of these serious buyers.
A few takeaways:
Is now the time to sell? Yes! Now is a good time to sell, buyers are looking. Interest rates are enticing and those who can, will take advantage of this opportunity. As a seller though, temper your expectations.
Is now a time to buy? Yes! Now is a good time to buy, people are shifting. Take advantage of the interest rates if you can, make offers that are reasonable and have patience with the outcomes.
Regardless of your situation, if you’re in the market start gathering your paperwork and learn the market. Get your finances in order, stay flexible and look forward. To quote Katie Witry from her recent feature and cover story in New Orleans Real Producer’s Magazine: “Progress through Planning” – a mantra we can all adopt during these changes.
Stay informed and sign up for the Preservation Resource Center‘s online classes and consider becoming a member to support the continuation and efforts they’ve put forth.