Question: What impact will Covid-19 have on the real estate market? Will it change the way sellers, buyers and agents interact going forward?
Answer: This is a tricky question at the moment. We have to adjust our way of doing business day-by-day, just like everyone else. Currently, real estate does fall under the critical category. People do need to move and that involves many other industries, such as inspectors, appraisers, movers, contractors, lenders, and title companies. I have been following many of the leading economists lately and they are all echoing the same sentiment: We came into this crisis with a very strong real estate market, the shorter the crisis, which they believe it will be, the more likely we will have a very robust 3rd quarter. This virus spread fast and made a big impact but may be gone before an actual financial recession, like in 2008. This was not caused by subprime loans, this is a pandemic. Yes, there will be some fall out, but no one at this moment has lost 30% of their home value. Home prices are holding strong. We are still in an active market here in Colorado.
In regard to how doing business will change, like anything we are adjusting. I had three closings last week where the sellers were able to sign their documents by e-signature or at the windows of their own cars. I am hearing lenders are working towards remote signatures, as well. The title companies are asking agents not to attend closings and are only allowing two or three people in a room (of course with Purell on the table, a new pen and sitting 6 feet away from each other). Photographers are asking that we do not meet them at the property, but to leave all lights on because they will not touch the light switches. Many of these changes are good. It is about time we have all documents available online and signed via the internet. It saves a lot of paper and time.
As far as physical showings, we have seen a slowdown. A lot of them are now “Virtual Showings”. Vacant homes are much easier and more comfortable to show. At my office, Kentwood Cherry Creek, we have put kits in each home with hand sanitizer, booties and have asked people not to touch doorknobs, handles, etc. There are now addendums we are attaching to contracts which allows more flexibility because dates might need to be adjusted based on the current circumstances. It is a new world and we are all adjusting. I do believe some of the changes will stick after this crisis is over and for good reason.