The real estate market in the age of pandemic
by Ryan Zimmerman, Wheeler Steffen Sotheby’s Intl. Realty
The first draft of this piece was scrapped completely, as I sit now to write it again. What is happening in the real estate market has been changing so regularly based on new events, regulations and broader market conditions that unfold each day as COVID-19 continues to alter what is “normal” for everyone.
In my first iteration of this article, my assessment was that the market was extremely strong, especially here in Claremont. Inventory remained incredibly low, and buyer demand high. Those circumstances, coupled with very low interest rates (that even hit an all-time low for a few days) resulted in homes selling extremely fast, often times with multiple offers, and over asking prices.
The rules of real estate, of course, still applied—a nice home, when marketed very well and priced appropriately, will sell...and quickly in these market conditions.
Now, as I write this, the real estate market operates a little differently. The number of new listings hitting the market has slowed drastically. Some would-be sellers out there who don’t have an urgent need to sell now, are deciding to hold off until the dust settles a bit and a semblance of normalcy returns to the world. Thus, sales have slowed.
But the homes that are hitting the market seem to still be selling quickly, and from what we are hearing, for close to or even over asking price if priced appropriately. So virus or not, it seems homes can, and will, still sell.
One of the biggest factors that affects how real estate is done now is the stay-at-home regulations that are in place. Open houses are no longer allowed (one of the tools in a realtor’s tool belt), and even normal showings of a home are not possible.
Buyers now have to make offers on properties “subject to” interior inspections, which would take place at a later date, after an accepted offer is in place. Realtors are having to utilize technology more than ever if they want to sell a home in the current climate.
Showings are now being held virtually, where the seller is “Face-timing” with a prospective buyer while walking through their home. Even better, some agents are utilizing a 3D walkthrough technology that allows a buyer to virtually walk through a property on their computer, smart phone or tablet. The resolution is in HD, and the buyer can look around and walk through the property at their leisure. However, the second option only works if the listing agent has utilized that technology.
With all that said, I have seen several homes go from “active on market”?to “pending in escrow,” even during this unique period of time. In fact, this can be a great opportunity for buyers who have recently found themselves competing against multiple offers and getting outbid left and right. If some of those buyers are staying out of the market and in their current residences, a seller who is still wanting to sell now might still have the perfect buyer just waiting for their home to hit the market.
Many of my clients have been calling the past few days to ask what they should do. It’s been a tough question to answer, as this is an unprecedented time, with never before seen circumstances.
Some are deciding to hold off on listing their homes, while others have decided to move forward and utilize technologies that will allow buyers to still see their homes; in some cases, almost as good as being there. Both are perfectly understandable paths.
We agents don’t have previous experience to draw upon where we can say “Well, the last time this happened…” so we are discussing what’s best for each client on a case-by-case basis.
The forecasts from economists show that real estate sales will drop due to all of this. And that sounds about right. But the number of sales doesn’t always mean that prices are dropping along with them.
It is likely just because fewer people are putting their homes on the market. So far, we haven’t seen signs of home prices falling. Interest rates remain very low and attractive for buyers, which is good for sellers alike.
I think the next few weeks will be very revealing about what will happen in the real estate markets, but for now, it could be a unique opportunity for sellers to sell their homes while all the competition waits to put homes on the market. If you’re the only option a buyer has who needs to move, that’s great news for you as a seller.
For more information on the current housing market, or how these powerful technologies work, please contact Ryan Zimmerman, Wheeler Steffen Sotheby’s Intl. Realty at (909) 447-7707 or email firstname.lastname@example.org.