This post on the coronavirus impact on real estate sales here in Silicon Valley is updated periodically, depending on unfolding events, so please check back often.
The market for houses is hot (still)
The coronavirus pandemic caused a worldwide surge of buyers rushing to purchase homes with more square footage, more rooms (home office, room for elderly parents to move in), and more outside space.
Locally, single family home prices rose about 20% over one year, despite the initial lockdown and restrictions on showings. Pools had not been so desirable pre-Covid, but now they are more sought after as buyers want to vacation at home.
Initially, it was challenging to sell a condo or townhouse, particularly if there was no patio, balcony, yard, etc. Those homes did start appreciating, but have not performed nearly as well as detached housing has.
Now, in September 2021, many of the requirements have been lifted. Buyers are still interested, but the steep appreciation has priced some buyers out of the market.
Quick overview of what is and isn’t allowed with real estate listings and sales
The landscape for home sales is complicated and more restricted than pre-pandemic times, but easier than it was in March – May 2020. The market is strange in many ways, but it is possible to buy and sell now and actually is not so hard at this point.
What’s changed with Covid:
- Anyone visiting the interior of a home MUST wear a mask. This is true regardless of vaccine status.
- Some listing agents and sellers are requesting the buyers and their real estate agents wear shoe covers or gloves inside.
- Most private showings are still by appointment only, even in vacant homes. I have come to appreciate that as usually it means my clients and I are guaranteed a set period of time to view the home in peace. When there are not scheduled showings, if a home is underpriced, buyers and their Realtors start lining up and there’s pressure to rush through the showing.
- Buyers and their agents usually drive separately now. It was required and I’m not sure if it still is (but it seems the wise thing to do).
- More sellers are moving out to sell now. Some may just take a 2 week vacation or stay in a nearby hotel until the home is a pending sale. Others move out fully and permanently, and the home is professionally staged to sell.
Once forbidden, but now allowed again:
- Agents may again use paper, such as leaving business cards or utilizing fliers at the homes.
- Broker tours are again permitted.
Escrow challenges include these:
- The buyer and seller real estate agents do not attend the sign off at the end of escrow. The notary wants less exposure to people who aren’t essential at that meeting.
- Appraisals were drive by in many cases for awhile, but now most are going inside. However, they generally want to be alone and not have a Realtor or other person be present.
Other things to know:
- There is an addenda from the California association of Realtors to address closing and other delays due to Covid-19. Some companies may create their own similar addenda for the coronavirus escrow complications and delays as they won’t like the language in the CAR form.
- There’s also a listing agreement addenda regarding the risks of having visitors into the home.
What should home buyers or sellers do with this concern about the Covid-19 virus now?
It seems we are through the worst of the Covid restrictions, such as the lockdowns, need to sign the PEAD form before showings, and many other obstacles to buying and selling are in the rear view mirror. In Santa Clara County, about 82% of the eligible population is fully vaccinated. Even so, 307 are getting diagnosed with the virus each day. It’s not over yet, so we will need to try to roll with the punches if there are changes in showing and selling requirements. Winter may see a rise in cases, and that may trigger changes with showings and sellings. We’ll have to play it by ear.
BUYERS: If you want to buy, if you haven’t done it already, now is a good time to pull your paperwork together for a pre-approval, or to get it pre-underwritten, which does take time. The challenge is low inventory.
SELLERS: If you want to sell, now’s a good time to do the hire an agent and get going on everything. September and October are often good months for selling, and with inventory being crazy low, your odds of success are good. It is not too hard to sell now, especially in the lower price points, as long as the home is priced appropriately, marketed well, clean, easy enough to see, etc.