Pros Bet on Post-Pandemic Rebound, Survey Finds
April 9, 2020
The spring housing market will be slower than normal due to stay-at-home orders by many states and municipalities to control the outbreak of COVID-19. But the majority of real estate professionals see the slowdown as temporary and are optimistic that a turnaround will occur once social distancing measures are lifted.
Nearly six of 10 REALTORS® recently surveyed reported buyers were delaying home purchases for a couple of months. Similarly, 57% of real estate professionals said sellers were delaying home sales, according to the National Association of REALTORS®’ Economic Pulse Flash Survey, conducted April 5–6.
“Home sales will decline this spring season because of unique economic and social consequences resulting from the coronavirus outbreak, but much of the activity looks to reappear later in the year,” says Lawrence Yun, NAR’s chief economist. “Home prices will remain stable because of a pandemic-induced reduction in inventory coupled with less immediate concerns over foreclosures.”
Indeed, mortgage servicers are also saying they are unconcerned about a flood of foreclosures hampering the housing market since swift actions were taken to offer forbearance options to out-of-work homeowners. Home prices are thus largely expected to remain stable. Seventy-two percent of REALTORS® said sellers have not reduced prices to attract buyers, according to NAR’s Economic Pulse survey.
Real estate professionals are finding ways to work virtually to complete some transactions. The most common tools leveraged are e-signatures, social media, messaging apps, and virtual tours, the survey found.
Property managers are facing rent payment issues as more tenants request delays to making their monthly rent. Nearly half of property managers—46%--reported being able to accommodate tenants who cannot pay rent and 27% of individual landlords reported the same, the NAR survey shows. The Coronavirus Aid, Relief, and Economic Security (CARES) Act includes a provision for eviction prevention as well as small-business loans and grants for assisting the rental market.
As stay-at-home orders to fight the COVID-19 outbreak prevent business as usual, some real estate brokerages have furloughed their agents so that their agents can then take advantage of unemployment aid until the market turns around. On Tuesday, Redfin’s Glenn Kelman announced 41% of the firm’s real estate agents would be furloughed, likely until Sept. 1.
“Today is the worst day for Redfin, but the service being performed by the agents and support staff who will remain is more important than ever,” Kelman noted in a post to its website on Tuesday. “The pandemic will end. … To those who have been asked to leave Redfin today, thank you. I can’t imagine the grief we’ve caused you. I’m sorry we let you down. We’ll fight like wild animals to bring everyone on furlough back.”
Updated: June 03, 2020