While real estate is technically classified as an “essential service,” to protect the health and safety of buyers, sellers and agents, restrictions are in place that limit what can and can’t be done.
Disclaimer: The rules and regulations related to real estate transactions change nearly every day, so the reality may be different by the time you read this column. Feel free to contact me with specific questions.
Q: How have the shelter-in-place restrictions impacted local sales?
A: Fairly dramatically. The number of houses/condos sold in Santa Clara County is approximately 50% less than it was at this time last year.
Q: Why did the numbers drop off so much?
A: Many buyers who had just gone into contract were worried that they had overpaid. Active buyers were unsure about the direction prices might be headed. The shelter-in-place rules made it virtually impossible to actually tour in person a house listed for sale. Therefore, the majority of the closed transactions in the first 30 days of the shelter-in-place were houses that went into contract before the lockdown.
Q: How have prices been impacted?
A: Not as much as you might think. In some areas, prices are down a bit, and in other cases, they have increased. Some of this effect is based more on the price mix of the homes that sold rather than actual price appreciation.
Q: Would now be a good time to try to get a good deal on buying a house?
A: That is a common question, but in reality, most sellers are not needing to reduce prices to sell their homes. I do see price reductions in homes that were overpriced to begin with or in need of a fair bit of work to get them livable.
Q: Would now be a good time to sell?
A: Actually, yes. The caveat is that I always advise my clients to sell when the timing is right for them rather than trying to predict the market.
Q: Why would now be a good time to sell?
A: Simple supply and demand. Buyer demand has remained strong and fairly constant, yet the number of houses on the market is low. We may see a spike in inventory later in the year if many sellers decide the same thing. But for the near term, there are more buyers chasing fewer houses.
Q: I hear a lot about virtual tours, virtual open houses and virtual staging. What is that?
A: To reduce the amount of exposure and contamination, many agents are encouraging the viewing of homes for sale online. Photos, videos, walk-throughs, floor-plan maps, drone views, and more, are posted virtually so that buyers can look at a house online without having to leave their homes. A virtual open house is a live event that buyers can join in on from home and actually walk through the house with the showing agent. Buyers can direct the camera and ask questions. Virtual staging is a way to show online what an empty house might look like with furniture placed virtually in the photos.