While the real estate industry is currently open for business, it doesn’t look quite the same as it did prior to the COVID-19 pandemic. Real estate brokers took a direct hit as a result of Governor Jay Inslee’s March 15, 2020 Emergency Declaration to close bars, restaurants, and all public gatherings of more than 50 people, as well as the Stay-Home, Stay-Healthy Proclamation issued on March 23, 2020. Shortly after the March 15, 2020 Declaration, the Northwest Multiple Listing Service (“MLS”), which is the primary property listing service in Western Washington, disabled its open house features within its system, effectively preventing real estate brokerages across the region from hosting and/or seeking out open houses on behalf of their clients. In addition, the Stay-Home, Stay-Healthy Proclamation effectively disabled the ability of Notary Publics to perform their services that allow real estate transactions to close. With thousands of real estate transactions in the pipeline effected, along with many clients looking to enter the real estate market, brokerages, escrow companies, and all of the professionals involved in facilitating the closing of real estate transactions, had to quickly adapt, while also waiting for the government to ease some restrictions.
Today, while brokers are encouraged to conduct their real estate business from home, they are allowed a bit of wiggle-room in showing homes so long as they implement the social distancing and safety measures established by the U.S. Department of Labor and the Washington State Department of Health. Brokers are allowed to meet one-on-one with a client, by appointment only, at a specific property and no more than two people may be onsite at any given time. The same rules apply to appraisers and inspectors. On March 24, 2020, Governor Jay Inslee issued Proclamation 20-27 allowing Notary Publics to perform their transactions remotely.
While some of the restrictions on the real estate industry have eased a bit, there is still a huge road block in moving homes. It is hard to sell a home when the buyers cannot easily gain access to the property. As such, we are starting to see brokers getting creative and utilizing technology to show properties via Virtual Tours tools and video technology, which assist clients in viewing the property without stepping foot in the house. Whether or not these technological tools are effective will come down to the performance of the real estate market over the next several months. There is no doubt that COVID-19 will have an impact on the market, we just don’t know yet the severity of the impact.
Market projections for April and May is that real estate sales will trend downward. It may be a couple of months until we see the actual impact that the Coronavirus will have. For example, we may start to see higher demand for single family homes in the greater Puget Sound, as buyers will be looking for homes where they are able to socially distance, as opposed to a condominium, where socially distancing is difficult.
We may also see the already low interest rates drop even lower. In the meantime, buyers in certain areas throughout our region are seeing an environment with less competition and, as such, have more time to make decisions. This, in turn, means that sellers are not getting instantaneous offers and have to remain a bit more patient than what we have seen in recent years.
It remains to be seen what the overall and lasting impact of COVID-19 will be on our local real estate market. But it does seem that social distancing, video tours, in-person viewing of homes by appointment only, and electronic notarizations will be here to stay for quite a while. If you are in the market and want to buy or sell, make sure you do so safely and that you choose a broker that is acknowledging all of the safety measures put in place by the government and who is not just driven by the commission that he/she will earn by closing your transaction. On the other hand, if you want to perform the transaction without a broker while maintaining social distancing, a properly vetted attorney can assist you for a fraction of the cost of a broker.