We’ve seen a lot of changes in our day to day lives over the past few days. The COVID-19 global pandemic has affected many people and unfortunately many have lost their lives as a result of this.
The real estate spring market has been affected due to the restrictions enforced including practices of social distancing, the admonition of staying at home, and limitations on physical exposure.
Some buyers who have purchased a home might be wondering what will happen now. Will their purchase still close? If they lose their job, will they be able to back out of the deal?
Some homebuyers are actively searching right now do to their genuine need of purchasing a place. Perhaps their rental term is expiring and they’ve made a commitment to buy a home. Or perhaps lifestyle changes are pushing them to acquire property.
In this blog post I want to explore the considerations and expectations a buyer may face in this market. I want to help you, if you are buying a home amid challenges surrounding COVID-19, navigate the market safely and effectively.
The Home Buying Process
The process of buying a home amid COVID-19 is pretty much the same with the exception of safety measures and limitations on showings. Buyers interview Realtors to see who they want to work with, sign a Buyer Representation Agreement with the real estate agent of their choice, browse homes online and arrange for showings on the ones they like, negotiate an offer, fulfill conditions and close the purchase.
The difference between the usual home buying process and what’s happening now is the use of technology to minimize physical interaction, and the use of personal protective equipment when physically seeing properties.
It won’t be unusual for your real estate agent to provide your with masks and gloves, ask you to disinfect your hands before and after each showing, and to arrange your own transportation for the appointments.
Some home sellers are starting to restrict showings while others only provide a virtual showing option.
Your safety, your agents safety and the home sellers safety is very important during these challenging times. It’s not worth risking your wellbeing and the wellbeing of others so make sure you take all the safety precautions advised to you by your Realtor.
Physical showings are still being permitted but real estate agents and their clients must practice social distancing. This means Realtors can not drive their clients around with them in their car (a practice that has become less common anyway).
During the physical showing, Realtors will encourage you to maintain a safe distance away from them. Homeowners and other occupants of the house should not be home during showings.
When it comes time to discussing an offer, meetings are done virtually through online meeting applications such as Zoom.
Buying Real Estate Virtually
Some home sellers are restricting showings to virtual, meaning you won’t be able to physically visit the house and see it in person. Technology being used during the pandemic allows buyers to have a 3D virtual walkthrough of the home and experience it through high definition photos and videos.
It doesn’t beat the experience of physically being there but it’s a start.
When you do decide to put an offer in on a home you see virtually, you can add conditions for a physical home inspection or even just a physical buyer visit.
Can You Back Out?
Good question — and the simple answer is no. I’m not a legal expert, but based on my discussions with lawyers, a purchase agreement made during this time is still enforceable.
You may lose your job during this pandemic, and you might have purchased a house a few weeks prior, but in many cases you will still be responsible to uphold the agreement you’ve made.
There’s a slight possibility that you’ll be able to work something out with the seller if your life’s situation has changed, but it may incur costs or damages.
Should You Buy Right Now?
The answer: it depends. Did you already sell your home and now you’re in need of a new home to move to? Is your lifestyle change requiring you to purchase at this time? Are you looking for opportunities in the market to buy real estate?
The spring market momentum will be affected by this pandemic.
Sales won’t amount to what they were last year.
But sales will happen.
If you’re already sold your home and you need to purchase one to move into, do so safely. There are homes listed for sale and homeowners who need to sell.
If a lifestyle change requires you to buy now, proceed with safety in mind. Work with a real estate agent who understand the precautions necessary to help you look for a home in this market.
If you’re looking for an opportunity to buy at a discounted price, you may be able to find motivated sellers who need to move. At this time, prices are still stable, and with the relatively low inventory on the market, multiple offers are still happening.
But over the next few weeks, some homeowners who need to sell but may not be getting the buyer traffic they seek could be adjusting their price expectations.
I will monitor the market over the course of this pandemic and share my findings with you over the next few weeks.
Stay safe and well.