The first cases of Covid-19 were recorded in China at the end of 2019, and now, four months later, there are millions of confirmed cases across the globe. In addition to the public health consequences, Covid-19 is having a devastating effect on the global economy. Almost every industry is being affected in some way, and real estate is no exception.
Historically, spring is the high season for US home-shopping. In recent years, online real estate search activity began to ramp up in March and April, leading to a peak in sales in June and July. However, strict stay-at-home measures have recently been implemented in many places in the US, which will clearly put a strain on the real estate industry. The total effect on real estate is still being determined.
So far, studies have shown a decrease in home listings by more than 30%, an uncharacteristically high drop for this time of year, which suggests that this anomaly is the result of a Covid-affected market. Asking prices have also been decelerating, recently reaching the slowest year-over-year growth rate since 2013. Mortgage rates also dropped to an all-time low of 3.29% in March. Some metrics, like the time properties remain on the market and overall inventory, are slower to react to market changes and have yet to be determined.
The real estate industry is not at a complete standstill, but agents able to do showings will have to take different precautions. Here are a few suggestions for steps agents can take to keep themselves, buyers and sellers safe during Covid-19.
Throughout the country, regardless of local rates of infection, the Center for Disease Control recommends limiting unnecessary contact as much as possible. In many areas, this means pressing pause on open houses and home showings. In areas such as New York City, showings should be completely postponed until the virus is more under control. In most other areas, agents should not offer face-to-face in-person showings or advise their clients that they will always remain six feet away from them while in a location.
Thankfully, technology provides many alternatives for showing homes. Video is a great option for showing properties to clients sheltering at home. Using drones, virtual reality home tours, and virtual neighborhood walks, agents can give clients a comprehensive understanding of the property from the comfort and safety of their own home. Agents that do not have video footage of a property should consider taking it themselves or hiring a company to do so. Agents should also consider scheduling virtual listing appointments using Zoom and a presentation of the listing.
Alternatively, agents still able to go to the property can host a live stream event on social media. Since this is an activity that does not require other people, agents will be safely alone and able to generate buzz around the property.
Implementing a smart lock system is another option to allow clients to see a property in person, but without an agent present. With a smart lock system, sellers or agents can control entry to the property using a smartphone to remotely lock and unlock the doors or providing visitors with a one-time access code. This technology can also track entries and exits, limit access to certain time periods, and add value to the house. This option has been growing in popularity with agents even prior to the pandemic, because it helps increase the number of possible house viewings. In this time of Covid-19, it has become an even more worthwhile investment.
Despite all the virtual options available, many buyers want to see a property before they purchase it. For agents who are permitted and choose to continue offering in-person walk-throughs, it is important to take safety precautions. Instead of holding an open house and allowing people to show up at any time, offer time slots for walk-throughs, so people can come and check out the property without additional exposure to strangers. Advise anyone who arrives early that they must wait in their car or outside of the property, maintaining six feet of distance from other viewers.
Keeping doors propped open is one way to prevent guests from touching things as they move around the property, and asking them to wear booties can limit external contaminants. Wiping down all surfaces with disinfectant will limit cross-contamination among visitors.
With the rate at which the situation is changing, it is difficult to predict the long term effect that Covid-19 will have on the real estate industry. If mortgage lending isn’t overly affected, real estate could be a good option for people looking for less volatile investments in a financially tumultuous time. For the time being, it is essential that every agency makes conscious efforts to keep their staff and their clients safe in the hopes of flattening the curve and helping business return to normal as soon as possible.