The COVID-19 pandemic is forcing people to spend a lot more time at home, and many people are feeling like they need more space.
Often, when people check with a local Realtor, they are pleasantly surprised at what their house is worth. But the surprise wears off quickly when they either can’t find their next step, or the cost of their dream home is a lot more than they can afford.
The cause of these recent upticks in price, as well as lack of housing availability, is due to COVID-caused supply line shortages.
When you are buying or selling your home, it’s important to always have a backup plan in case things get delayed. If you’re looking for a house in McHenry, IL, and the surrounding areas, Diamond Real Estate Law can help in the event of delays or other issues. It is also helpful to have a reputable attorney on your side in the event your housing problems become a case.
Read on to learn more about COVID issues with real estate closings in Illinois.
What are the supply line shortages and what does that have to do with real estate?
A supply line shortage is when a certain industry, for example the lumber industry, is unable to meet the demands of those seeking their product.
This can be due to many different factors, but the gist is they can’t meet the demand with their supply.
These recent shortages have arisen because of the COVID-19 pandemic, and the way that each industry has been affected has compounded into slowing down the housing market.
While houses are still being bought and sold, it’s just taking longer to complete the process.
Why are there housing issues in Illinois?
The lack of inventory has many buyers stretching their resources to the max and creating less flexibility in closing dates.
The uncertain and unusual situations created by the pandemic and supply line issues create all sorts of scenarios where sellers are not able to close on time, and buyers have no place to go.
Unfortunately, it is predicted that the shortage of houses for sale will last far past the pandemic.
Here are some reasons why the housing shortage is affected by COVID:
- Construction material has become scarce due to supply delays/shortages
- Labor shortage due to COVID
- New variants exacerbating existing delays
What is an example of supply line shortage effects on real estate
Here is an example of how supply line shortages have affected the buying and selling process.
Let’s imagine the seller’s attorney tells the buyer that the seller is hospitalized with COVID and has to postpone the closing. The buyer had a winning argument if they went to court, but a winning argument in court did not give them a place to live.
The buyer had a week to either work something out with their landlord, who had signed a lease with another tenant, or find a temporary place to live with their kids and pets in the middle of a pandemic. The situation was tense, to say the least.
In this real-life situation, the good news is that we did find a way to work things out and the buyer did not end up homeless. The bad news is that this type of high-stress situation is common in residential real estate these days.
The underlying problem, aside from the uncertainty created by the pandemic, is the lack of available, affordable housing inventory.
Contact Diamond Real Estate Law
- Reviewing and drafting real estate contracts;
- Making sure you know what you need to do to comply with the contract; and
- Ensuring that your interests are well-represented
Representation is particularly important in the event of titles with defects or issues with disclosures.
Especially during this time of shortages, Diamond Real Estate can help make sure you’re actually getting the best deal for your property rather than being taken advantage of. If you are buying or selling property in McHenry County (or the surrounding area), we invite you to call Diamond Real Estate Law to schedule a consultation with an attorney. Our practice places a high priority on client satisfaction and open communication. You can reach us at (773) 217-9623.
DISCLAIMER: Any information contained herein is solely for informational purposes. While it is important that you educate yourself, nothing herein should be construed as legal advice or create an attorney-client relationship. For specific questions, we always urge you to contact a local attorney for advice pertaining to your specific legal needs.