How COVID-19 Is Changing Home Buying and Selling
Owing to the coronavirus, the current situation finds us spending most of our time stuck at home. But life goes on, even if you’re planning to sell or buy a home. You just need to prepare for big changes in the shopping experience. In fact, innovations in the home buying and selling process are helping us get around physical limitations. These changes have profound long-term implications on how real estate business gets done.
Virtual access to your home
Before coronavirus hit, the housing market was good for sellers. There were more home shoppers than sellers, which often meant multiple offers on a single house. That led to a consistent upward price trajectory for homes across the U.S.
But listing your home today has new complications. On the positive side, the federal government considers both residential and commercial real estate essential businesses. This means companies and employees working in real estate can continue operating without a government recommendation to close its doors. The down side is this does little to alleviate people’s fears about doing anything that risks contracting the virus.
The first thought most sellers have during the COVID-19 lockdown is that they don’t want strangers in their home. As a seller, the idea of a daily parade of real estate agents and potential home buyers walking through every room in your house doesn’t feel like the safest choice. Especially when you consider they’d touch every door knob, faucet, and light switch. Who wants the added effort of having to disinfect their home each day? For that reason, the selling process is more virtual than ever.
When searching through home listings, you expect to see a lot of pictures. If a listing has a virtual tour in addition, all the better. It wasn’t the norm to include 3D video in every listing, but having it to fall back on is doing a lot for people selling during the COVID-19 outbreak. Zillow reported a massive surge in 3D home tours made using their software. Between the start of the coronavirus outbreak and March 18th, the site saw a 215 percent increase in new listings with 3D tours. Real estate agents are also getting involved, sending smartphone videos to clients if they’re able to walk through the home.
The benefit of including a 3D tour in your home listing is potential buyers get a realistic picture of your property. They can imagine physically being there as the camera moves through each room. For younger shoppers who are used to buying everything online, this type of footage can help convince them to make an offer on a home.
Virtual tours and showings
While brokers have utilized FaceTime for remote tours for years, virtual platforms are becoming invaluable to the real estate market. Multiple listing services are updating rules and technologies to create easier access to virtual showings and tours. Facetime, Zoom, GoToMeeting, and other video conferencing options ensure everyone keeps a safe distance from each other, while maintaining the interactive element for potential buyers. Unlike a pre-recorded walkthrough, virtual tours let shoppers look at rooms more closely, double back and view from different angles, and ask questions along the way.
For sellers, this greatly limits traffic in the home, without preventing it from being seen. You’ll still have to allow real estate agents in to do these virtual walk-throughs. But screening and managing a few agents is a lot easier than controlling the comings and goings of countless buyers. You can turn on all the lights and open all the doors, asking agents to leave everything as is. You can even follow the agent through your home silently to ensure contact with your stuff is limited.
Reliance on data
Virtual transactions put an added importance on information that can be collected remotely. Like many iBuyers, Sundae relies on data and public records to make a fair, accurate, and competitive cash offer to a seller. We follow a careful valuation process developed from our extensive real estate experience. To arrive at an estimate, we use a combination of analytics data, tax records, comparable sales prices, maps and geolocation tools, and satellite images.
However, we think the most critical piece is still the on-site visit. We won’t make offers without seeing your house in person. For that reason, we’ve implemented stringent safety precautions and policies that our Market Experts follow when they come to your home.
Read more: COVID-19 and Housing: What You Should Know
Online home buying
Home viewing and shopping are not the only big changes in the wake of the virus. Another shift is in the home purchase process. Traditionally, certain parts of the process required buyers to be there in person. Recording the title at the clerk’s office, inspections, and appraisals were all in-person activities. On the day of the sale, both the seller and buyer must sign a litany of papers in an office before the transaction is complete. With this becoming more difficult, emerging alternatives seem to be either signing remotely or facing a delay in concluding the sale.
Twenty-three states currently have remote online notarization laws. But this option needs to go nationwide in order to help everyone. At the time of publishing this article, a new bill enabling remote transactions within the real estate market was awaiting approval.
The drastic impact of the coronavirus on the economy will reverberate throughout the home buying and selling process. Government intervention to rescue businesses and workers affects real estate in several ways. One consequence is from the drop in interest rates. While rates for mortgages always fluctuate, it’s clear that the federal government wants to maintain low interest rates for the foreseeable future. Rates near 3.0% for a 30-year fixed loan serve as a counteractive force against a wider economic slowdown. A second factor is a large government stimulus bill that will keep many companies afloat and provide cash relief to American families. How this enormous legislation affects real estate in the long term is unknown.
Lower-than-normal interest rates and extra cash will entice people to house shop even during stay-at-home orders. But it won’t work on everyone. As COVID-19 sends shockwaves through the economy, it’s safe to assume fewer home transactions in coming days. Broader economic factors like unemployment hurt people’s ability to afford a house, regardless of interest rates or government stimulus. Early signals suggest that real estate showings will slow down. This means virtual steps in the home sales process are here to stay. It also encourages homeowners to consider creative methods to sell their house.
With so much uncertainty in the home buying and selling process right now, going the traditional route and listing your home may be more than you can handle. Selling a home in normal circumstances requires managing many details, but sellers today take on even more. An alternative to consider in the era of coronavirus is to go off market.
Selling your home on Sundae’s Marketplace means a quicker and safer sale for a number of reasons:
- Sell As-Is: No clean up or repairs. No showings, open houses or uncertainty. Sell as-is without listing your home on the market or doing any work.
- Close at your Pace: Close in as little as 10 days, or take your time and move up to 60 days after accepting our offer.
- Zero Fees, No Closing Costs: You pay zero fees and no closing costs when you sell your house with Sundae. The home visit is free and comes with no obligation. We don’t do a full home inspection until after the purchase and sale agreement has been ratified by both parties.
- No Obligation: The home visit and offer are free and come with no obligation. You have no obligation to accept any of the offers you receive
- $10,000 cash advance before closing: We work on your timeline to complete the closing process and provide support with up to a $10,000 cash advance before closing for eligible sellers.