Updated April 2020                                                

COVID-19; A New Way of Business.

Problems and Solutions in an ever-changing Real Estate market...

Wow!  What just happened!  2020 is proving itself to be a year of many new obstacles.  We have found ourselves trying to search through, and process, the ever-changing landscape in all areas in our day to day lives.  So many unknowns, and fears, seem to be presented to us every day in the ways of; health, public safety, government preparedness, job loss, unemployment, small businesses shutting down, paying our bills, public schooling, groceries, supplies, quarantine, and "Where the hell is all the toilet paper?!"

It's no wonder we are all overwhelmed and feeling panicked. And, it's also no wonder that the Real Estate markets have be unpredictable, leaving some unsure how to proceed.  The perceptions of many is that we are in a rapid downward spiral into another market crash.  Public perceptions have a huge impact on what and how consumers spend their money.  Toilet paper is a prime example of what 'perceptions' can do in any market.  There is no doubt that we are in an unprecedented time, however, there are some huge differences between our situation now, and what was our crash about 10+yrs. ago.  

Back then, there were many issues that played a roll in the crash.  An article published in 2017 by Colin McArthur and Sarah Edelman with Center of American Progress on AmericanProgress.org sums it up by stating; "The real causes of the housing and financial crisis were predatory private mortgage lending and unregulated markets.  The mortgage market changed significantly during the early 2000's with the growth of subprime mortgage credit, and significant amount found its way into excessively risky and predatory products."  When jobs were being lost, the market couldn't sustain and homes were foreclosed.  Homes were no longer worth what the Banks had lent on them.  Investments and Retirement accounts were drained of value, and it became overwhelming for the economy to keep up.  It took many years to get us to that situation, and for about 2 years, we worked hard to recover from it. 

And recover, we did!  Today, Mortgage and Real Estate industries have made huge changes since the crash.   We learned so much from that time, and changed systems to help prevent fallout in the future.  Now, there are ARMs that cap the interest rates, so they can't jump too high, too quickly.  Accountability and documentation are very strict, and down-payments are typically a min. of 3.5% down. Interest rates and down-payments now weigh heavily on the acquisition of the loan.  Up until COVID-19 hit, we anticipated at least 3 years of steady numbers and great growth.  

Then it hit us, like a bomb.... BOOM.  Naturally, we ran to take cover.  Concerned about the lives affected, the lives lost.  Protecting what we have and what we need to survive.  Scared of what is to come.  Leaving the industry to wonder; What do those who were Selling their home do right now?  What do those who were Buying a home do right now?  How is our money going to be affected?  What can I expect in the future?  How do Realtors and Lenders need to respond to this crisis in order to provide the absolute best service to their clients?       

Just breathe, Don't Panic, Let's work this out.  I'm here to help.                                                                                                       

This is what we know...

1.  The "number of home-purchase contracts signed are all showing weakness due to COVID-19, particularly given that this is typically the ramp up to the spring home-buying season. Rental applications among prospective tenants also appear to have dipped as many households are required to ‘shelter in place’."

2.  For the next 3 months, we need to all work together to eliminate this threat, and then all work together to help heal our economic slow-down.

3.  There are two things that many are watching in order to gauge this crisis and its effect on housing; Purchase contracts falling through, and changes in construction. 

4.  We had no reason to doubt our numbers and predictions for economy prior to this virus, and foresee a surge in small business sales, and a boost in economy once the threat has been contained. 

5.  Realtors, Lenders, and Banks are working hard to navigate the unknowns, and prevent any long-term lasting affects in the Housing Markets.

So what can we do right now?!  Stay Calm.

Sellers in this market are asking...

Q; Should sellers weather out the storm, or pull their home from the market?

A; This depends.  Your need to sell (motivation) could be based on a necessity rather than a want.  In this case, yes, you should sell.  There are always Buyers out there that also NEED to buy.  My job as your Realtor is to make those connections, and help you make this process as safe and efficient as possible, with highly qualified Buyers that can close the deal.  It is a possibility that the time your home sits on the market will be a bit longer than anticipated. Banks need to navigate through many obstacles, and making sure the Buyer's income isn't being compromised due to this virus is a huge factor in not allowing another crash in the market.  Closing times have went from 30-45 days, to around 60 days to close.  

Q; What is my home's estimated value in this current market?

A; The numbers are very sporadic right now.  Interest rates are fluctuating on the daily, sometimes within the hour.  Some homes are being pulled from the market.  Some Buyers are jumping out from the market. All of it, making it very difficult to know how this will affect your market value.  Right now, early into this virus, we are seeing mostly that numbers are still within the original estimates.  Key is to keep moving forward, and close those deals before any major changes can affect your money.  Homes are now taking about 60 days to close, leaving us with the possibility that all of this will be ending by the time our numbers catch up.  

**Stay informed on Current Markets!  Click here to view reports in real time.

Q; How do I keep my home safe during this time?

A; Your Realtor should be making some major adjustments in their business and changing how to navigate issues of showing homes, eliminating risks, and promoting social distancing requirements; video tours for potential buyers, educating clients and customers how to prevent spread of virus in the cases of owner-occupied listings, providing and requiring a 'health questionnaire' for all potential showings to eliminate known risks, providing e-signing for all documents, providing telecommunications options for remote meetings and negotiations, working from home and flexible hours to provide full service to all involved, and professional cleaning solutions at closing.

Buyers in the market are asking...

Q;  Should I continue to look for homes during this time?

A;  This depends.  If you are a buyer that is NEEDING to buy, then yes!  Continue to move forward.  It is possible that in this current environment, buyers could have a bit more leverage and negotiating power.  This also depends on the Seller's motivation and how quickly they need to sell.  Having a Realtor skilled in negotiations will serve you well in this time.    

Q;  How will I get to see the home before I offer?

A;  Your Realtor should be, or have already, made the necessary adjustments to keep business rolling.  Video tours and telecommunications are going to be essential for keeping buyers informed and comfortable with their purchase.  In the case of vacant homes, physical showings are available to healthy, low-risk clients, with all social distancing requirements followed.  Communication has never been more important; between Client and Lender, Client and Realtor, Lender to Realtor, and Realtor to Lender.  Your Lender and Realtor should be working as a team to help you navigate, be proactive, and close your deal to protect you and your investment

**Are you looking for a Lender that will work for you and be a part of your 'team'!  Click here to schedule a no-obligation consultation.

In conclusion, much is still needed to be known about how this will affect Real Estate markets, but one thing is for sure, we will get through this together!  There are some silver-linings to be seen; We have had time to learn new ways of being, we've reconnected with family, we've become more aware of our surroundings, given the Earth the break it needs to take a breath and heal, realized that small steps taken as a collective effort DO make a difference, found that reading and Arts feed our souls, prioritized our lives, spent less money and given more love, we've reignited our passion for people, relearned vital skills, and we are now looking beyond ourselves for the ones who come next. 

Money will always come and go, but the need of taking care of each other will never diminish.

Stay strong, stay healthy, and keep moving forward without fear. 

'Helping you make the connections'

Reliable COVID-19 Resources;

Oregon Unemployment Information

COVID-19 Fact Sheet

Personal Prevention Flyer

Kids Activity Sheet

Kids Coloring Sheet

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Sited;

https://www.americanprogress.org/issues/economy/reports/2017/04/13/430424/2008-housing-crisis/

https://www.washingtonpost.com/news/business/wp/2018/10/04/feature/10-years-later-how-the-housing-market-has-changed-since-the-crash/

https://www.corelogic.com/landing-pages/covid19.aspx#a_HousingAnalysis1