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Real Estate Deals during the Corona Pandemic

19/6/2020

(This in an update to my post dated 22 April 20)

For starters: If you need to sell or buy a home now – because you are relocating for a job, in need of more/less space, or facing new financial circumstances that require a move – you shouldn't let the coronavirus stop you.

I closed two transactions in the last seven days, and during both cases we – my clients and I – never felt unsafe or that we running a risky gamble.

So I would say by being cautious, eliminating unnecessary any risks and following the right guidelines, it is safe to sell or buy a home even amid the coronavirus outbreak.

Classified as “essential business” by the Dept. of Homeland Security, real estate never stopped during the lock-down. A least in Florida, real estate brokers and agents were allowed to conduct business. But all new transactions - listings for sellers, searches for buyers, property showings and purchases - had to be electronic, with no meetings in person. While this was truly uncharted territory for buyers, sellers and Realtors alike, the last two or three months showed how it can work, and rather well actually.

Even with most restrictions lifted, many transaction participants chose to leave protective measures in place out of precaution; that includes my office as well.

Step by step:

Listing a property is not an issue, since all trades are available: photographers, building inspectors, appraisers and title companies are on board. If sellers do not feel comfortable meeting in person with a Realtor to discuss a listing, the meeting can be conducted online through video--calls.

For showing properties, personal meetings and visits are allowed again, but a Realtor can also conduct a video-showing from the site if one party feels uncomfortable or is in a high-risk group.

Open houses are not happening right now, and as a requirement for showings, all buyers are asked to narrow online their list of possible homes as much as possible, to provide a Covid-19 risk questionnaire as well as a pre-qualification letter before a showing, and to follow showing guidelines (masks, gloves etc).

Appraisals and building inspections are being conducted, which are vital for loan approvals – and in my experience of 28 years, even in a cash purchase, buyers should always have an inspection conducted.

Title companies are closing deals; many of them are conducted electronically, but some in a personal meeting, which I personally do not recommend.

And finally, court houses and tax appraiser offices are working electronically, so deed changes can be properly recorded.

Thus, the workflow of a Florida real estate purchase or sale is intact and functioning.

Do you have any questions?

If so please give me a quick call at 954 834 3088, email me, or let's set up an online meeting via Jitsi (no extra software needed), Skype, Signal or Google.

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The Housing Market - last Week

16/6/2020

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Single Family Home sales, South Florida March - June 2020

SFH: TriCounty; wk 1 Mar - wk 1 Jun'20, medians for: List price of all Actives (blue), LP of Pending Contracts (orange), LP of all Solds (teal), Selling Price of all Solds (green). ©Kaiser Assoc. via SEFMLS

Condo/TH sales, South Florida, March - June 2020. ©Kaiser Assoc.

Condos/TH: TriCounty; wk 1 Mar - wk 1 Jun'20, medians for: List price of all Actives (blue), LP of Pending Contracts (orange), LP of all Solds (teal), Selling Price of all Solds (green)

I wasn't joking when I headlined this post 'The Housing market - last Week'.

Because of the market volatility, I switched from quarterly data to weekly data to see trends faster. The numbers I'm analysing are in two groups:

Inventory and sales of Single Family Homes in Palm Beach, Broward and Dade counties, with their list prices and selling prices.
Inventory and sales of Condos and Townhomes in Palm Beach, Broward and Dade counties, with their list prices and selling prices.

What makes it interesting is the gap: not The Gap Band, but the difference between what sellers ask and what buyers are willing to pay.

And a big gap it is. Currently it sits at an 18 percent price difference for homes and 17 percent for condos/TH. That is 3 percent worse for houses, but 4 percent improved for condos compared to the prior week.

In clear English: by median prices, single family home buyers are paying 18 percent less than what sellers are wishing for, and 17 percent less for condos and townhomes than what sellers dream of. And that is substantial. That we have, in no particular sequence,

A) a difficult presidential election year
B) a marathon pandemic far from being over and
C) major civil protests against racism and injustice

does not help stabilising the real estate market. How could it?

There is simply no telling where this market is going – way too many wild cards. A buyers' market it is, or should be... Unless you encounter delusional sellers.

Again, I close with Edward R. Murrow's most appropriate quote:

"Good Night, and Good Luck."

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THE MODERNIST ANGLE

Real Estate Deals during the Corona Pandemic

The Housing Market - last Week

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