The coronavirus pandemic made many Americans rethink where they live. With record-low mortgage rates, is now the time to move?
When COVID-19 began to spread through communities most people knew that there would be many changes to how people managed to go about their daily life and work. This was true for realtors, where hand shaking and hugs were part of the excitement of closing on the homes. Pittsburg was no exception to the impact of COVID-19.
As for the buyers themselves, the way they went to look for a new home changed too. The use of technology and limits on the number of people allowed to tour the homes has become commonplace.
Local realtors shared the trends that began because of the pandemic. Brian Jones and Monica Angeles of Jones Heritage, Realtors said they are doing selective showings only to clients that are prequalified.
“This has always been something we strive to do, but many times, we go ahead and initially show a customer in hopes we can educate them about getting prequalified,” Angeles said.
They are also putting more emphasis on virtual tours, which include a 3D tour thanks to the help of a local company with Matterport capabilities, Multiple Listing Service (MLS) virtual tours and live or Zoom house showings.
“Real estate is a relationship business,” Angeles said. “Some of these changes will enhance how we do our job (virtual tours, 3D tours, in-office closings), but at the end of the day, people want to be present to personally look in every nook and cranny of a home, shake your hand at closing and take pictures with you when they get their keys.
“That is my favorite part of the job so I hope that stands the test of time. I would love to see title companies be able to do virtual closings with the buyer signing electronically with it being witnessed, like a virtual notary.”
Other trends include less in-person documentation during closings, more in-office closings rather than visiting the buyer or sellers wherever convenient, and limiting showings to the buyers instead of their extended families and friends. Gloves, masks and sanitation wipes have also been incorporated.
It’s more than just social distancing. According to a recent report, more than 26 million people in the United States have filed for unemployment before the end of April.
Local furloughs have affected people who just bought a home or were in the market to do so, the realtors said.
“Some buyers that were pre-approved were no longer able to purchase because they were furloughed,” Jones said. “Some buyers got nervous and canceled the contracts they had just started because they weren't sure what was going to be happening. Some sellers decided to wait to list their home because they didn't want to take the risk.”
Inventory is also down, Brian said, adding that this is mostly because sellers are afraid to put their property in the market.
“Because of that, some houses that have been on the market for a while are now getting activity and in some instances new listings have received multiple offers,” he said. “I do expect there will be some foreclosures after this is done. Although homeowners have been given a 3-month forbearance on making their mortgage payments, some of them will continue to struggle after we completely reopen and possibly not be able to make their payments.”
Timothy Kundiger, broker and agent of Timepiece Realestate, said that more buyers are “being pushed towards specialty loans where they can put little to nothing down,” regardless if they can afford “typical loans.”
Kundinger encouraged people to think about their financials when choosing a loan and home, adding that “we need to get back to a sustainable lending system and people being responsible for their decisions.”
“It is only a matter of time before the next local issue becomes global and we feel the pinch again,” he said. “I hope that people will have learned something during this period in time and remember it the next time some lender pushes them to buy at the top of their income with money they don't have.”
In an attempt to get things moving again, Kundinger said, “it wouldn't surprise me if some type of First Time Home Buyers program pops up again giving ‘free money’ to further dig the hole.”
The realtors said they are adapting to the many changes the pandemic brought forth in their industry, from less inventory to the slowing down of business. Jones said video and virtual tours will most likely continue to help buyers with their preliminary research and “intrigue them to look at the homes.” However, “real estate is a very fluid business, things are always changing — it goes back to the old saying ‘Pictures are worth a thousand words,’” he said. “People like seeing pictures and videos are even better.”
“Nobody likes change but people came together to make the changes that we were seeing deemed necessary, work,” Jones said. “We were all in this together and with a little bit of kindness, help and understanding, people were able to and are still getting through this.
“We are very fortunate in Pittsburg to have schools that are still giving breakfast and lunches to kids, the Lord's Diner that is still doing meals, the Pittsburg Strong movement to help local businesses, etc. Yes, it is tough but working together we are making it through this. It is not over, and we need to continue to work together.”
The pandemic has delivered a one-two punch to Northeast Oklahoma beginning with the record high and long-lasting Grand Lake levels of 2019, which essentially ruined the area’s tourist season.
In 2020, as lake levels looked good showing a promise of a good summer season, the coronavirus forces the shutdown of almost all businesses in the area.
The one-two punch.
But not all is lost and not all is bad, with some economic sectors looking pretty good, like real estate for example.
Though the market is “down a little over last year,” according to the local RE/MAX office owner, Chuck Perry, there are some bright spots.
“Actually, even though the market is down a little, we are ahead of last year by around 6-7%.”
They have modified some business practices to meet CDC guidelines.
Real estate selling is naturally a person to person business and meeting social distancing guidelines necessitated some creativity.
For instance, they no longer have customers ride with them, but take separate cars, which makes it more challenging to speak to people new to the market about the flavor and strengths of the area.
When looking at potential homes to purchase, the prospective buyers are asked to let their agent be the only one touching things and Perry said they wipe down as they go.
Additionally, masks are worn, foot protection (booties) are worn by all and they use a lot of Lysol wipes throughout the day.
When it comes to staff, most meetings are now virtual on Zoom and Zoom is being utilized more with customers, too.
Some customers are so comfortable using online services that they have used those services to choose and look through a property.
The use of 360’ video “visits” and drones can add perspective about the home and the surrounding neighborhood.
Some customers have even made an offer and purchased a home just based on what they’ve seen online through a virtual tour.
Around 80% of closings have been via email and electronic signatures and Perry believes that a majority of closings will continue that way, even after the pandemic is gone.
Perry commented on how helpful corporate RE/MAX has been in providing answers to questions, offering daily webinars with personal training on how to protect staff and customers.
As the economy opens back up, Perry is excited to see how the remainder of the year will finish.
As mentioned, his office is up over the same period last year and they have already sold two lake properties, each in the $1.3 million range which is very strong start for the year, despite the COVID-19 pandemic.
He feels there is a real pent up demand to list their homes, especially as “people are laying low, keeping people from going in and out of their homes” due to the coronavirus.
Because of that, inventory of homes for sale are low throughout all price ranges in the area.
Buyers continue to hunker down as they shelter in place, but as the weather gets nicer, they are getting antsy to get out to see what the market has available.
Add the very low interest rates, which helps to lower monthly payment and allows an increase in the price of the home they can buy.
Lake front sales traditionally stay strong and are staying true to form as this year progresses.
Even though interest rates are very low, Perry says his two largest sales this year (over a million dollars each) have been cash deals for lake properties, not mortgaged.
It is evident that as Oklahoma re-awakens, and Grove, Jay and Delaware County get rocking again, 2020 could end up being a good year, despite the one-two punch Mother Nature tried to deliver.
Hopefully, as businesses open up, restaurants begin seating people again, residents come out and employees get back to work, the economy will pick up and get back to buzzing.
Harrell Post has been like a cat — he keeps landing on his feet.
The long-time Miami real estate agent and auctioneer spent 15 years at the B.F. Goodrich tire plant before it closed in 1986.
He bounced back from that event that blew a massive hole in Miami’s economy, going to auction school, then the following year got his real estate license.
“I had a chance to go to Tuscaloosa (Alabama) or Fort Wayne (Indiana) (where other BFG plants were located) and decided I wanted to stay here and not go through another shutdown,” Post said.
Post has dealt with economic downturns and now has had to deal with a COVID-19 outbreak that has brought the American economy to its knees.
“I’ve had to rebound two or three times, but the good Lord has blessed me. I’m not complaining.”
He said throughout the COVID experience, he has kept busy with customers.
“I am not selling all I want to sell, but as far as showing, there are people out there looking for a bargain,” Post said.
He said he’s not heard one person say they are looking because interest rates are down.
“I am sure it’s having an effect on it; there’s a lot of people refinancing right now,” he said, noting that he’s done numerous appraisals to give them an idea on the current land or property value.
“A first-time homebuyer, I have not heard that statement at all,” Post said. “It’s a buyer’s market here.”
He had one piece of property that has been listed three months, has shown it at least 30 times and has had two or three offers.
“The offers have been low, but I finally got what the gentleman wanted and we’re going to close in a couple weeks — it’s a cash deal,” Post said. “I don’t complain whether I am a co-broke (teaming with another broker) or by myself. As long as I get a payday, that is what I am after. It all adds up.”
Susan Rhodes of SolidRock Realtors (Susan Rhodes Group) said she’s been surprised by the amount of business her firm has had throughout the pandemic.
“It has been nonstop since we locked our doors (for virus safety reasons),” Rhodes said. “We would go meet people and we would let people come in one at a time to sign a contract. It just never stopped.”
She estimates that 30 contracts were closed in the first 30 days of the lockdown and there were 34 more ready at the time of this interview.
“During the course of the virus, in the very early stages, the one thing that probably hurt more than anything was the credit score requirements on loans went from 620 to 660,” Rhodes said. “That caught a lot of people that were approved and then they were not. There weren’t a lot, but I am sure there were two or three that it happened to.”
David Davis of the NEO Realty Group of Miami also was baffled.
“This is a crazy time,” said Davis. “There is no rhyme or reason for the influx of the business we’ve had especially since the (interest) rates actually are up three-quarters of a point to a point from when COVID started,” he said.
Davis said the 2010 census showed that Miami had 35% rental and he estimated that the numbers would increase to 50 to 60% rentals once numbers of the 2020 census are crunched “which is kind of an alarming number.”
“I think it’s going to have some real challenges to the property management side. There are so many people whose cash-flow streams have been interrupted; the rental market is going to be disturbed. Interest rates are still low enough that people are buying.”
Land makes a long-term investment - especially in rural areas
In the last few months, almost everything shifted across the nation and the globe. Social distancing has brought change to every type business but especially in real estate. Rural land, whether it's used to grow food or raise livestock or for hunting and fish, is in great demand.
At Whitetail Properties, they know the both the value of land and the current market climate.
Here, in a few questions, staff provides answers to the big questions many Americans are asking.Specialist Tony Chrisco and Chris Starnes serve Southwest Missouri and have in-depth knowledge of the current market and land values in the area.
As real esttate specialists, they feel the biggest change in real estate since the COVID-19 pandemic has been learning how to adjust to business while practicing social distancing.
"We have done this by practicing strict guidelines, to not only protect ourselves but our clients as well. One way we have accomplished this is by not only having virtual meetings but also having virtual tours and curbside closings, as well," they said. " A lot of these changes will be more permanent as time goes on. It has made us think creatively and it will now become the new normal.
WTP said from their perspective the rural real estate market has never been better. They are constantly getting calls from future buyers wanting to find their perfect getaway, and what better way to practice social distancing, than to have your own farm or rural recreational tract.. In addition, with record low interest rates and folks wanting to find a place outside of town, it has also been a perfect opportunity for sellers, with land prices bringing a premium in most areas.
Chrisco and Starnes also issued a statement about the current times in rural real estate:“During these difficult times, with navigating uncharted territory, it is not only important to keep our clients safe but additionally to innovate. We have come up with new ways to reach our clients and help them find their dream property or improve upon their current property. We have changed the way we interact using tools like, zoom in place of face to face meetings and curbside closings, to keep safety paramount. We have done more virtual tours of properties to bring the land to you in the safety of your own home. As land specialists, owning your own farm helps to understand the needs of our client base. We have offered clients ideas on improving their land and growing it’s worth. There is always something to be done when you own land. From food plots, brush hogging, clearing fence lines, checking and working with livestock, the list goes on and on. We offer firsthand experience as land specialists, tapping into our clients’ needs and always striving to grow and improve.” With strong rural land values and increased interest from buyers, now is an opportune time for landowners considering selling their property.
As the nation’s largest rural real estate company, Whitetail Properties continues to be the most knowledgeable source of information about the markets they serve. Utilizing a customized marketing plan, they help landowners sell quickly for the best price possible by reaching the largest number of qualified buyers.
Rebuilding America: Video tours? Suburbs vs cities? Buying, selling a home to look different after COVID-19