Covid-19 and the Real Estate Market
2020 is off to a historic start. It feels as if it has been almost a decade ago since we celebrated the new year. Before I sat down to write this blog, I checked the calendar. My jaw dropped as I realized we are only a third of the way into 2020. It's not even Easter yet. Like many of you, I feel as if we should at least be half the way through the year. These past couple of weeks have felt like an eternity. The entire world has been impacted and we all seem to have a heightened level of anxiety.
Much of the anxiety stems from uncertainty. What else is there to watch on Netflix? When can I leave the house and get some time away from my loved ones? Will major sports like the NBA, MLB, NHL, MLS, and the NFL suspend their seasons? My attempt at levity with this situation is a precursor to many more important questions families are facing. What is going to happen with our economy? What is going to happen with our jobs? When will we flatten the curve and get back to normal life?
Spring and Summer are supposed to be the busy season for real estate. Many families had made the decision to make a move. Some families were going to sell and start a new chapter in a new home. There are many young professionals and small families excited about leaving their rental house and fulfilling the American Dream of owning their own home. Others might be downsizing as their last child has left the roost. Some might be expanding their families and need to upsize. Whatever the reason for buying or selling, those plans are uncertain now. Sellers are wondering if buyers are still interested in purchasing. Buyers are surmising if sellers will let them see their homes amongst fears of spreading Coronavirus. These are indeed uncertain times.
However, the light at the end of the tunnel might be in your hands or at your fingertips. A lot of business can be conducted virtually now. Many therapists are holding appointments via skype, FaceTime or Zoom calls. We can shop online for almost any product (except for toilet paper apparently). Schools and universities are completely virtual now. Real estate can also be conducted virtually and seamlessly now, too.
The chief economist for the National Association of Realtors (NAR), Lawrence Yun told the NAR that he believes home sales should be down only about ten percent. In the same interview, he says, "The stock market crash is no doubt raising economic anxieties, while the coronavirus brings fear of contact with strangers. At the same time, the dramatic fall in interest rates may induce some potential buyers to take advantage of the better affordability conditions." In this same article, the NAR polled members about buyers' interest in purchasing a home amid the Coronavirus pandemic. Of those questioned, 78% claimed Covid-19 has not changed their interest in purchasing a home [REALTOR® Magazine. (2020, 27 March). Sellers Adopt Showing Procedures to Minimize Coronavirus Spread. Retrieved from https://magazine.realtor/daily-news/2020/03/12/sellers-adopt-showing-procedures-to-minimize-coronavirus-spread].
In Seattle, where Covid-19 is among one of the more infected areas, REALTORS® they are reporting that the housing market is still competitive with many multiple offers on homes. California is experiencing much of the same. Most other areas in the United States are experiencing the same [REALTOR® Magazine. (2020, 27 March). Sellers Adopt Showing Procedures to Minimize Coronavirus Spread. Retrieved from https://magazine.realtor/daily-news/2020/03/12/sellers-adopt-showing-procedures-to-minimize-coronavirus-spread].. Buyers, sellers, and REALTORS® have adapted to the times and can practice safe alternatives to conducting real estate transactions.
For buyers, Tyre Realty Group and other companies upload virtual tours online. Many of our agents are able to show homes via video conferencing software. TRG and many other firms utilize digital signature programs to allow clients to sign offers from the safety of their own homes. In Pitt County and most other counties in North Carolina, the Register of Deeds offers digitally recording services. Almost all of the buying process can be completed without leaving your home.
Much like buyers, sellers are also adapting. Sellers can also hold virtual appointments with their agents by sending a video walkthrough of their home before listing. Digital signature and digital recording also can be utilized by sellers. In the aforementioned NAR article, sellers were polled to find if there are any changes in their behaviors when showing their homes. 77% of sellers stated that they have not changed their behaviors in regard to showings [REALTOR® Magazine. (2020, 27 March). Sellers Adopt Showing Procedures to Minimize Coronavirus Spread. Retrieved from https://magazine.realtor/daily-news/2020/03/12/sellers-adopt-showing-procedures-to-minimize-coronavirus-spread].
As more information is learned about Covid-19, TRG will provide updates and tips on how to buy and sell during this time. To help stop the spread, TRG is taking extreme caution. Virtual tours and showings are preferred. If the property has to be seen, agents are using hand sanitizer and disinfecting wipes with them the showings. Some agents open the door, and one-by-one buyers see the home. The use of booties and latex gloves are other options.
While some buyers and sellers will put their real estate needs on hold, low-interest rates and rising home values still create a fantastic market. Many buyers are taking advantage of extremely low-interest rates. Sellers that might have put their home on the market later in the year, might rescind that decision, causing the current homes on the market a window of increased value. As our high school economics class taught us, when the interest rates are low, borrowing is increased. The same inverse is true for supply and demand. A low supply of homes will lead to an increase in home values.
While we all want to return to normalcy, we encourage everyone to stay safe to help flatten the curve of infected persons. If you are feeling sick, use caution and do not schedule homes to see or allow showings to occur. Limit leaving your home to limit the possibility of being in contact with Covid-19. Wash your hands with soap for at least twenty seconds. A nurse friend of mine gave me the tip to sing "Happy Birthday" while washing your hands. The "Happy Birthday" song is roughly twenty seconds long. Other common-sense measures such as coughing into your shoulder, sneezing into your elbow, sanitizing phones and avoiding public areas will all help.
While these are uncertain times, TRG understands that life must still continue. Just like we still need to eat, buyers are still buying and sellers are still selling. Rest assured that TRG is handling the Coronavirus with extreme caution. We have virtual options for seeing homes and signing offers. We are amongst the leaders in Eastern North Carolina with the use of virtual tours as all of our homes have a virtual tour available. As one of the younger offices in Pitt County, we are adept in using technology to help you continue purchasing that new home or selling your current home. Visit our website at www.tyrerealtygroup.com to talk with one of our agents.