Putting your home on market in Covid Era
I have been in real estate since 2005 and been in Boston for about twenty years. I started my career when everyone was buying, and no one wanted to rent, and then in 2007–2008 I experienced the sub-prime mortgage prime crisis, and Boston and the metro area felt those effects but compared to other parts of the country we recovered. Setbacks in the Boston Real Estate market is nothing new, however, we have never experienced an event that affects us locally, but at the same time around the globe, people are trying to figure out how do we manage the day to day lives during a pandemic.
There is no road map on how to function and how things will turn out down the road in this Covid Era. Clients have asked me should I Sell my place? Should I rent it out? Should I go into a panic state? Is there any good news you can tell me?
Real Estate Agent Perspective
First, I wouldn’t say sell your condo in the city unless you need to liquate your assets. That would be a good reason to sell your home. If your job looks and feels pretty solid then my advice would hold onto it and ride out the storm. The Real Estate Market goes up and goes down. Long term prices should be in an upward trend. The market is in the middle of a shift, and if you have to sell now might be the time to do it, but you should put alot of thought into the timeline you want to sell and why your selling. Your agent should really understand why your selling and the marketing efforts should also match what your end goal is.
How has Real Estate Practices Changed
The Real Estate Industry has changed how we do business in the wake of Covid 19. Sellers should ask this question to there agent. How are you going to market my property? Are open houses being done? How are showings being done? Do I have to let every person in my home in wake of covid 19 when there is a showing request? What are measures to keep me and my family safe if I allow showings or open houses? What tools are the real estate community using more that they weren’t using before?
Covid 19 has forced many industries to change and the Real estate industry is no different. Real Estate is determined as an essential business during this pandemic. Our doors to our public offices might be closed but agents were still working.
Technology and New Way to do Open Houses
Clients in March, April, and May asked me often how are Open Houses and showings happening? Open Houses went virtual with the help of Mattaport 3D tours and Zoom. Agents became Videographers shooting video with there phones. Perspective buyers signed up for the virtual open house and the agent was either in the property first doing the 3D tour with parties on the zoom call and later bringing the camera around the home and answer buyers questions. Later as pandemic lived on open houses did a combo of zoom and open houses by appointment. Open Houses by appointment is just how it sounds. There was a block of time for the open house and allotted time for each party. All safety measures were taken during the open house. What is in your comfort zone
Technology and Comfort Zone
Some sellers want everything virtual and would only get the buyer in after there offer is accepted otherwise. Sellers should be really Realistic what makes them feel comfortable but at the same time, the more restrictions you put in place the longer a home might stay on the market. There is a balance and one plan doesn’t fit all. Your agent should have a plan before it goes on the market. It wouldn’t be a bad idea to discuss if covid 19 numbers change how does the plan gets adjusted ahead of time.
Real Estate Transaction in wake of Covid 19
Once an accepted offer has been delivered its not a bad idea for the seller to know what has changed. Are home inspections being done? Who attends the home inspection? Every home inspector has a different policy. Asking about a policy that home inspection company is a good question all parties should be asking. Some home inspectors are only inspecting outside of homes and others are inspectors both but asking for no one to be in the home. Manage the expectations is key during these times. Smoke Inspections have resumed but how your fire dept does them might be different.
If you’re worried about legal matters during covid 19 speak to your real estate attorney.
Communication is your best friend
Communication is key early on. The more you communicate with your agent the better off parties will be. Sellers have been told homes should be broom swept prior to closing, but in wake of covid 19 maybe take it one step further and just have home professional cleaned. The process for seller has changed and most of the changes occur when the home is on the market or going to market, but alot of the changes that have gone in effect the buyer more than the seller.
The biggest change will face is they do not have all the keys to the kingdom when selling there home. Prices are shifting downward and with interest rates low and buyers can get more house for the money especially in the city. Sellers in the city might have the biggest adjustments to make. The argument my neighbor down the street got this amount a month ago or a few months ago might not hold weight. Pricing your home for the best price is key.
Work with that offer and why
Prior to covid 19 pricing in the city was shifting and now the shifts are larger. So that first offer you get you might feel insulted, but it might be the best offer. Sellers might want to work with that offer. Some sellers say well I want to leave the city and move to the burbs. I want to Sell or Rent and think putting it on the sales market same time. As an Agent who does Sales and Rentals please don’t put it on both markets. Putting your home on market for sale and for rent drives both markets down, and the savvy buyers or their agent might notice that the home is on market in both and they might offer less then they would if it was just on market in one.
How to price your rental
If you have to put it in both markets you need to do the math. What rental price covers your mortgage, taxes, water, and sewer, and hopefully that price is reasonable. If you put your home on the rental market you should mentally prepare yourself for a few things.
1) If a renter knows you tried to sell and ended up renting your home out instead you are kidding yourself that factor might not matter to a prospective tenant.
2) Rentals are a fast-paced transaction you should have all documents in order prior to going on the market. A seasoned agent will make sure you have all your ducks in a row to make the transaction move smoothly.
3) Your agent should know how to do rentals the right way. If you think less money less legal headaches please get that thought out of your mind.
4) The decision should be made fairly quickly since renters have options
5) Renters are used to looking at a place and saying going to think about it a day or two. Talk to your agent when listing for sale or rent what the plan is when someone wants to view it in person.
Test both Waters in the Fall
I do not recommend sellers put units on the rental market till late fall. If you want to sell then sell. If you want to rent then rent, but putting it on both I do not recommend doing till late fall. Why you might ask well hopefully by late fall there will be less inventory on market for one so your home on the rental market might fair better, and we are going into an election year and typically after an election, the market gets better.
What is the same and what has changed
The real estate market used to be a personal thing, and it still is. The conversation is often starting at a distance before we do face to face meetings. Owners have had to adapt but so does the consumer. I do not expect it to be easy for Buyers or Sellers to find the dream home at the right price, but I do think buyers finally have that upper hand that they haven’t had for a while if looking in the city or close to the city. If you are a landlord you know what market we are in.
We are not in a landlord market we are in a renters market, and prices keep going down. Like landlords, Sellers have seen record prices and had good reason to smile, but often what goes up must come down at some point in time and we are at the start of a downward trend.
So when your pricing the home you need to realize pricing and value go hand in hand. If a consumer doesn’t see value in your home they might not want to view it. The value will continue to be a trend in 2020 and continue into 2021. The market will rebound and weather you opted to hold and ride out the storm or sell. You will find in retrospect the past is not that bad as it appeared at the time. Thinking about Selling, Buying, or Renting Happy to help. Contact me today for a free evaluation.