In the midst of the most bizarre, scary time of our existence, and with economic repercussions that will likely match those of the Great Depression (or exceed), most people have been ordered to 'Stay the F+@& Home'. These now ubiquitous terms: 'social distancing', 'essential', 'non-essential', 'the peak', 'the curve', etc, have permeated our worlds.
But, we want to focus on the essential versus the non-essential, as these terms create an implied inherent value in a human being's profession. Or not. They mean, your job isn't something that is needed during this time, so you cannot work. While another may be deemed 'important' enough to work. We are not writing this to get into the semantics of that argument in general, because it opens a can of worms into politics, religion, and many other topics we don't want to discuss.
We do, however, want to talk about the real estate business that is now considered 'essential' in CT and more recently in NY. What does this mean? It means anyone with a job that relates to anything in real estate (attorneys, mortgage, real estate agents, appraisers, etc) can work and ignore the mandatory stay-at-home. This raises plenty of arguments for and against this action by our state governments. We understand that healthcare workers, those who are ensuring the utilities stay running, and people ensuring there is a food supply, are much more important than real estate agents and our business, but it doesn't mean we aren't important as well. We will get into that, but first, let's see how the real estate market is functioning in this new world:
Real Estate in the Post-COVID-19 World
While our business is a healthy combination of face-to-face and virtual interactions, it's important to note that both are necessary to sell or buy a home. If you cannot see the home, most buyers are too skittish to buy it. The feeling a buyer gets when visiting a home is what makes or breaks the decision to proceed or not. Vacant homes have become a hot commodity and showing those is much easier than one with a family inside. Here are some aspects of the business that must change:
Showings
When taking our buyers to show homes, we have been asked some really interesting things. First, we require our buyers to fill out a form with questions such as: Have you tested positive for COVID-19? Do you have a fever, cough, trouble breathing, or shortness of breath? Have you traveled in the past 14 days? Have you been in contact with someone with a confirmed or presumptive case of COVID-19? Yes, it's a new world we live in. Agents are also asking questions about how many kids will be at the showing, are our clients older, etc. Those types of questions border on discrimination but are necessary right now. When we arrive at showings, most homes provide gloves and booties, and our buyers (and us) are wearing face masks. It's not just the fear of contracting the virus, it's the fear of spreading it. But, showings must go on because people need to have a home. This has led to the implementation of more virtual walk-throughs of property, and other means to 'see' the home without entering it.
Listings
On the flip side, our sellers are as wary about showings as the rest of the world. In some cases, we have pulled our listings off the market until it settles down and this 'peak' passes or we have waited to put a listing on. But, vacant listings are easier to deal with, because there aren't people living there so buyers are much less concerned about entering. But, we still have our hand sanitizer (bought years ago before this mess, we are not hoarding it, we promise). And as expected, this means we have been implementing those same methods to 'see' the home remotely for buyers. This is exciting for our clients, as it means they may be able to get serious interest without anyone entering the home.
Inspections
We have had multiple inspections these past few weeks, and boy have they been weird. While inspectors want to be inside the home with just one or two people at most, OR prefer nobody enter at all, it has created a different dynamic. We (real estate agents) have chosen or been asked not to enter the home, and for good reason (so we sit in the car and read, and try to glean information by being there and talking during and after). But, this means that we cannot see the issues as they come up, hear the inspector describe the issue, or ask questions about it on the spot. While this is a great excuse for the agents that normally sit in the corner and read their books to continue to do that, for those of us who learn and want to understand while doing an inspection, it makes us less effective at doing our jobs. But, inspections must go on.
Appraisals
A normal appraisal done for every transaction with a bank involved has an appraisal and internal home inspection. Appraisers are no longer allowed to enter the home, for their safety and to keep this social distancing measure in place. Instead, they have been doing outside visits only and asking agents to describe the home and its nuances. This is an opportunity for buyers and sellers, as any major concerns such as an illegal apartment, a basement bathroom without permits, chipping paint, no handrail, or other safety issues that come up for an FHA mortgage, are all unable to be seen by the appraiser. So while most changes make our jobs harder as Realtors, this one makes it easier.
All of these precautions are necessary so we can keep working while we don't risk catching or more importantly, spreading this disease.
The Facts About Norwalk
While we are happy to discuss the market elsewhere, Norwalk is our market, so we will focus there. However, remember that much of what is happening here is happening all around us.
Inventory is incredibly low. At the start of 2020, we had 260 condos and single-family homes on the market. Today, as this is written, there are 251. Normally this might seem like not that much of a decline, but remember the market almost doubles between now and June in Norwalk. In March 2019 there were 380 homes on the market. In April 2019 there were 429. So, that is about 40%+ less inventory as compared to the same time last year.
But here on the ground, we are seeing some interesting things. While everyone is scared, and the market has stalled, transactions do proceed (we have 8-10 closings coming up, depending on if we can see them through). Buyers are still seeking homes due to the low inventory environment in the market before this all started. People still need to buy a home. Also, it's a swing from the seller's market only weeks ago, to a place where sellers seem desperate in some cases to make a deal (i.e. opportunity for buyers). While there is nobody who can predict what happens next, considering 10 million people will lose their jobs, we do see Fairfield County as being strong through these times, similar to how we managed to persevere through the Great Recession of 2008 and 2009. We will bounce back, and so will the market. This begs the question, is it prudent to prepare the home to sell, so that the moment the market recovers, you can sell in a low inventory market with no competition? Maybe. When that market shift comes, we will let you know, but if you think you will want to sell now, or when the market recovers, it's still worth having a conversation and getting the tools we can provide so you can prepare now.
Now, Let's Talk About Why We Think This Business is Essential
In a time where we are stuck at home, yes, the home that you bought or rented, or your parents and family bought or rented, we realize that this wouldn't have been possible without a transaction between people, whether with a real estate agent or not. While the argument can be made that it can wait until this virus passes, first, sometimes it literally cannot. If a family has their home sold and under contract and must find somewhere to live, then they risk being homeless or risk this virus, it's an impossible decision. But, with precautions, the risk is mitigated and the decision is easier to find a home. Or, someone might not be able to afford their home because they lost their job. There are many other reasons why it's necessary to sell ASAP, and waiting cannot happen.This also begs the question, how long? How long will this go on? How long will we be sequestered? These are questions to which nobody knows the answer, and at some point (for those who were able to pause on buying and selling), at what point do you stop waiting?
People must be able to find and buy or rent a home, and they must be able to seek a buyer or a tenant. Our homes, our sanctuaries must be preserved during this crisis, and for those without a home or about to lose their home for some reason, it is essential.
What Does This Make Us Think About?
This makes us think about those without a home because while we sit here in Fairfield County and most of us are taken care of, we know there are hundreds of people in Norwalk alone that are homeless and don't have that place to go. That's not to speak of the hundreds of thousands of others in this country, and millions around the Earth that aren't lucky enough to have a place to sequester themselves, and to which they call home. We are in the home business, we are the people who are ensuring as many of our fellow human beings have a place they can sequester. We provide protections that others cannot. We are essential in that way.
So, this all gives perspective, it makes us grateful for what we have, but it also allows us to justify that our business must go on while others cannot. It's terrible to see so many small businesses go out of business, so while posting about this may seem heartless to those who are not deemed 'essential', we do what we can to support our local businesses as we always have, just from afar. You should do the same. Eat out when you might not have to, try to buy the things you need from the local businesses first, and order from Amazon second. Save some money so that when all of this is done, you can go and spend it on the services and restaurants that need that patronage out of the gate.
Those of us in this real estate business are essential, and while precautions must be taken, we are hoping to help you and your friends and family, ensure you have a home to stay, in while the madness resolves itself. Everyone stay safe, be kind to those around you and remember your local businesses and services.
