Selling Overseas Property After The Pandemic

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Selling Overseas Property After The Pandemic

July 01, 2021

 

What Now for the Post Pandemic Property Market?

 

As the world returns to normal, the overseas property market is picking up steam, but what will the future hold?

The pandemic has had a major impact on the property market, much as it has on everything else. However, as we near the light at the end of the tunnel, what will the post pandemic property market look like? Much has changed and many questions need to be asked. How quickly will travel restrictions be lifted? Will there be further waves? When will short term rentals return and which areas will offer the best results?

Nothing is set in stone, but we can make a few educated guesses. 

 

A very different recovery

Predicting what’s about to happen is difficult because we’ve never had a crisis like this. Although we’ve had pandemics before, we’ve never had the entire world go into lockdown with life continuing via online technology.

This is not an economy crisis born out of weaknesses in the system – instead it comes from a health crisis. That means there is a lot of pent up elasticity in the system. As things return to normal, economists are beginning to predict rapid growth for 2020 and 2021.

This could create a positive environment for holiday home owners as people take the opportunity to travel as soon as it is safe to do so. When this will happen exactly is unclear, with much of the 2021 holiday season already looking compromised. However, in the long term, the prospects are good. 

 

Gold standard performers

When the economy gets uncertain investors tend to retreat to the tried and tested stocks – those which can be relied on to deliver returns come what may. And the same will probably prove to be the case in the property sector.

Those countries and cities which have traditionally performed well will most likely be the ones which offer the most reliable investment options for the time being.

The pandemic put property markets in stasis. Everything was put on hold as the world struggled to sort itself out. As things pick up, countries – and their property markets – are returning to normal at different paces depending on how badly they were affected.

However, return to normal they will and the chances are the quickest will be the perennial favourites such as Spain and Greece.

 

Depressed vacation lettings

If you’re looking for vacation lettings to bounce back immediately, you may be disappointed. The pandemic laid waste to the holiday season in 2020 and has already taken a large bite out of 2021. With the longest day already behind us, the short term lettings market may take until 2022 to show signs of real life.

For now, buyers and owners will both be looking for solutions to keep things ticking over in the short term. This will almost certain mean a focus on longer term lettings in order to earn a monthly income until the holiday season kicks back in.

 

Should you buy now?

World renowned investor Warren Buffet once suggested you should buy when people are fearful and sell when they are greedy. In other words, when the wider market is on a downturn you’ll have a chance to gain assets at a discounted price. When the market is booming, you’ll end up paying over the odds.

Buying at the bottom of the market can be a great idea. That way you get to ride prices as they grow. The challenge is finding those opportunities where assets might be under-priced. An economic crisis should theoretically be a good place to find such openings. Already we’re seeing signs of growth with many countries registering double digit gains over the past couple of quarters. Where prices have been supressed in recent times, there is scope for a rapid rebound when things get back to normal.

 

Into the future

In many ways we can think of the pandemic as being a giant pause button. Many of the trends which influenced the market before the crisis are still relevant today. So if a country had a strong economy going into the pandemic, there’s every reason to hope for a strong recovery. At the same time, much has changed. Attitudes are different. People’s expectations have evolved. All that will filter through into the property market. What we don’t know for sure is ‘how’.

 

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