COVID-19 Impact on Real Estate During Lockdown

 

 

Update April 2, 2020

Since the initial announcement that Real Estate was deemed nonessential, there have many changes and realtors are now able to perform most of our duties.  That said, allowance for these changes is primarily intended to ensure properties under contract can get closed successfully OR that buyers/sellers who have a distressed situation or a significant need to buy or sell a home in the current market can do so without realtors violating the Stay Home Stay Healthy order issued by Governor Inslee.

Though realtors can once again perform most of our duties, even with strict guidelines in place, it is my opinion that realtors should not be operating with a “business as usual” mindset.  For all of us, our most important role right now is to stay home and protect the health of ourselves and those around us.

However, IF you are in a dire situation, and the services of a realtor are essential, I am here to help and will guide you through the guidelines we must follow in the current COVID-19 environment and help you navigate the real estate process.  I have been on many Zoom calls staying up to speed on how lending, escrow, title, inspections, appraisals and more are being handled remotely and/or with strict protocols for limiting person to person contact.

As to whether this is a good time to sell or buy, I am watching the market weekly.  Given the importance of slowing down the pandemic, if someone wants to sell or buy right now, I think we should work through the following questions before taking any action.

  1. Why do you want to sell or buy right now?  What is your “why” that is compelling you to consider a move?
  2. Are your finances in order, is your job secure?
  3. If selling, do you have somewhere to go?  Are you willing to stay in temporary housing before finding a new home?  With lighter inventory, finding a new home could take longer than normal.
  4. If buying, are you comfortable with taking on this new debt? Are you prepared to live in the home for a minimum of 7 years?
  5. For sellers and buyers, are you prepared for unexpected factors to impact the process?  Can you be patient and flexible?

We are all living in an unprecedented time that the majority of us were not prepared for, and it’s bringing up a wide range of emotions and reactions.  It can feel overwhelming and we’re not quite certain when it will end or what our new normal will look like once we get the virus under control.  In the meantime, I choose to see the many silver linings that are popping up in my community and across the country – more time with family, more people helping one another, more opportunity for creative play and expression, oddly more connection as we all learn how to use new tools like Zoom or GoToMeeting, more time to walk the dog and exercise, more time to cook or try new recipes, less time in my car, cleaner air, and the list goes on…..

Please take care of yourselves and your loved ones and stay healthy.  This too shall pass.

Update March 30, 2020

 

Last Friday, the Governor’s Office allowed some minor changes to the work that Real Estate agents can do during our statewide lockdown.  Note that these changes were primarily intended for two reasons:

 

  1. Allow homes that were pending when the lockdown occurred to get closed as intended with in-person inspections, final buyer walk-throughs, etc. and following social distancing guidelines.
  2. Address possible situations where a seller “has to sell”. 

 

In other words, real estate is NOT open for business as usual.  Windermere Brokers are taking the lock down seriously and doing our part to flatten the curve.  Please Stay Home and Stay Healthy.

Dear Clients and Friends –

As you know, Governor Inslee has issued a mandatory statewide lockdown for two weeks.  I spent Tuesday morning on three different video conference calls learning about the impact of the lock-down on the real estate market here in Washington State.  Here is what I learned, and please forgive me for not taking time to make it look pretty.  I wanted to get the information out right away.

Changes are happening hourly, but here is what we know right now. The lock down is effective today 3/25/20 at 5:30pm and currently in place for two weeks through April 8, 2020.  We were told that there is a high likelihood that the lockdown could be extended an additional two weeks which would mean the measures outlined below could be effective through April 22, 2020.  

Real Estate Services are NOT considered essential.  See below for specific impacts and changes to look for during the lock down period.  Note that some states have ruled real estate as essential, but more have ruled it not essential (most notably California and New York).  IF you own real estate outside of the state of Washington or the United States, check with your brokers in those areas.

The current focus in the real estate industry is on listings that are pending and under contract. Escrow companies, title companies, the county recorder’s office, and lenders who are able to work remotely will be working diligently to get these transactions closed successfully.  Should a delay occur, there are forms in place to deal with this at no harm to buyer or seller.  Moving companies are considered essential, so sellers and buyers can move as needed.

Information for SELLERS During the Lockdown

  1. Effective 3/25/20, the NWMLS is shutting down input of new listings.
  2. Active listings can remain on the market if sellers choose to keep their home on the market.  They will not rack up cumulative days on the market as a negative.
  3. The NWMLS is relaxing their position on “temporarily off market” rulings – let’s talk about the pros/cons of staying on the market right now.
  4. If your home is staged, we are hearing mixed messages on whether the furniture/items can be removed during the lockdown.  Let’s discuss on a case by case basis. Many staging companies are not charging rental fees during the lockdown.
  5. Moving companies are NOT essential, so this is a huge factor to consider right now.
  6. In person showings are no longer allowed and all lockboxes must be removed by 5:30pm on 3/25/20.  Accessing homes is punishable by law and the NWMLS may also fine realtors who ignore this ruling.  This means buyers will NOT be able to see homes in person and would have to be willing to write an offer on a home sight unseen.
  7. Note that home inspections are not allowed, so buyers would have to be willing to waive inspection.
  8. Note that in home appraisals are not allowed, BUT drive by appraisals are allowed.  Note that not all lenders will accept a drive-by appraisal.  This could impact lending under the lock down.
  9. Sign Installation companies will not be working as of 3/25/20.  So, no new signs can be installed.  If your sign does not get removed by 5:30pm on 3/25, it will be in place until the lock down is lifted.
  10. All remodel and cosmetic listing preparation work must stop during the lockdown.  Under the proclamation, residential and commercial construction workers and repair contractors, ARE considered “essential workers” ONLY insofar as the work is “related to emergency repairs and projects that ensure structural integrity”.  We were told this morning to point out that it is considered criminal activity if you leave your house for non-essential business or approved tasks (grocery shopping, doctor appointments, checking on family, or work that is listed as essential).

Information for BUYERS During the Lockdown

  1. Effective 3/25/20, the NWWMLS is shutting down input of new listings. This means inventory will be limited to what is currently on the market as of 5:30pm on 3/25/20.
  2. Active listings may or may not remain on the market.  Realtors will be discussing the pros/cons of staying on the market during the lockdown with their sellers.  So, you could see some sellers choosing to wait until the lockdown is removed and the market is back normal operations.
  3. In person showings are no longer allowed and all lockboxes must be removed on 3/25/20.  Accessing homes is punishable by law and the NWMLS may also fine realtors who ignore this ruling.  This means buyers will NOT be able to see homes in person and would have to be willing to write an offer on a home sight unseen.
  4. Note that home inspections are not allowed, so buyers would have to be willing to waive inspection.
  5. Note that in home appraisals are not allowed, BUT drive by appraisals are allowed.  Note that not all lenders will accept a drive-by appraisal.  This could impact lending under the lock down.
  6. If you have already seen a home and completed a pre-inspection that did not scare you off, I recommend submitting an offer. You may have some strong negotiating power in this market.
  7. If you have seen a home, but not been able to do an inspection, let’s discuss the pros/cons of waiving inspections on a case by case basis and discuss whether or not it makes sense to submit an offer.
  8. If you have not seen a home at all, let’s discuss the many downsides to submitting an offer sight unseen.  It’s a rare circumstance where this scenario would make sense.

I hope you found this information useful.  Please share with others who may have questions.

In the coming weeks, I will share information on the what economists are predicting for the housing market after we slow down the spread of C-19 and transition back to our normal daily routines.  In the meantime, I wish you all good health and I hope you are finding ways to take time to enjoy this unexpected “pause” in our lives.  I know it’s challenging, but I do think we will come out the other side stronger and quite possibly more connected in spite of our social distancing.

Virtual hugs,

Kathryn

 

Posted on March 25, 2020 at 10:17 am
Kathryn Lerner | Category: Uncategorized

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