While no one is expecting miracles from the spring selling season in the housing market this year, real estate pros say they’re confident the slowdown will be temporary, and that a turnaround will commence as soon as social distancing measures are relaxed.
That’s according to the National Association of Realtor’s latest Economic Pulse Flash Survey, which found that almost 6 out of 10 realtors believe buyers are simply delaying home purchases for a couple of months.
“Home sales will decline this spring season because of unique economic and social consequences resulting from the coronavirus outbreak, but much of the activity looks to reappear later in the year,” said Lawrence Yun, the NAR’s chief economist. “Home prices will remain stable because of a pandemic-induced reduction in inventory coupled with less immediate concerns over foreclosures.”
Mortgage servicers also say they’re not worried about the prospect of foreclosures hampering the market, as they’ve taken swift action to ensure homeowners can defer their monthly payments throughout these tough times. As such, home prices should remain fairly stable this year, the NAR said. It follows a finding that 72% of realtors say that sellers have refrained from reducing prices to attract buyers.
Also encouraging is the fact that most real estate pros seem to have adapted well to working from home, using tools such as e-signatures, social media, messaging apps and virtual tours to carry on with business.
The survey found that property managers are having a tough time with rent payments due to tenants requesting delays as a result of the COVID-19 pandemic. Altogether, 46% of property managers surveyed by the NAR said they have tenants who can’t afford to pay the rent, while 27% of individual landlords said the same.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act that was signed into law by President Donald Trump last week includes a provision for eviction prevention as well as small-business loans and grants for assisting the rental market.
As stay-at-home orders to fight the COVID-19 outbreak prevent business as usual, some real estate brokerages have furloughed their agents so that their agents can then take advantage of unemployment aid until the market turns around. On Tuesday, Redfin’s Glenn Kelman announced 41% of the firm’s real estate agents would be furloughed, likely until Sept. 1.
“Today is the worst day for Redfin, but the service being performed by the agents and support staff who will remain is more important than ever,” Kelman wrote in a blog post. “The pandemic will end. … To those who have been asked to leave Redfin today, thank you. I can’t imagine the grief we’ve caused you. I’m sorry we let you down. We’ll fight like wild animals to bring everyone on furlough back.”