Is Now a Good Time to Sell My Home?
**Update as of July 21, 2020**
New York has just entered Phase 4 re-opening post the Corona Virus pandemic. While many people will have the option of returning to work, several businesses have reduced or completely eliminated the need to be in the office. This has spurred strong demand for residential properties outside of Manhattan, as predicted in the article below.
Many homeowners are facing uncertainty and confusion about selling their home during the Covid pandemic and ensuing riots. Our new reality requires homeowners to consider new tactics to sell their homes quickly.
Several people believe that the economic uncertainty makes now a bad time to sell. But it’s quite the opposite in many suburban areas due to the demand from urban buyers looking for more space. In this article you’ll learn the insights many real estate investors are currently using and how you can apply them to help sell your home.
From job losses to businesses facing the prospect of financial ruin, the global Coronavirus Pandemic is causing turmoil. One sector, though, that shows some questionable trends during such uncertain times, is the housing market. The questions on the minds of many sellers is, can I find a home buyer during this time of uncertainty? Is now the right time to sell my home?
Chris Cawley, a licensed real estate broker in Tarrytown NY reports: “Short term, prices are holding steady and, in many cases, we are being them go up due to multiple offers because the demand is outpacing the supply. It seems that many people who were considering moving out of the city in a couple of years, moved up their timeline and decided they should do it sooner. Others decided that the idea of living in close proximity to their neighbors was too risky. In addition, with many companies leaning towards having their employees work more remotely, there is no longer a need to consider commute time….and if living outside the city is cheaper, why not?”
Therefore, with home buyers already facing limited choices in New York, if you’ve been considering selling your house, this may be a great time to do it.
Staying on the housing market, or jumping into it now, could, in fact, work to your best advantage.
The Current Situation in New York
Those who can afford it are moving from New York City into surrounding suburbs such as Connecticut and Westchester as they seek to escape the crowded lifestyle as well as the US coronavirus hotspot. Real estate brokers are reporting a rush of buyers from the city seeking more distance from neighbors and the NY crowds.
Right now, New York brokerage firms see an opportunity as home prices in leafy NY suburban communities are looking increasingly attractive to buyers who want to migrate from the overcrowded city hub. As a home seller, you should too!
Having noted that, what issues do you need to consider if you are thinking of selling a house in New York during quarantine?
The New Selling Environment
It’s stressful enough to sell a home in New York but when selling in the Covid-19 age of social distancing and quarantine, the task is harder. It, however, doesn’t have to be that way. Several simple strategies might help your efforts.
Even if you are not going to let in potential buyers physically, staging the home has never been more critical. Do it right!
Amidst the quarantine nightmare, virtual technology has become a must for any listing. Some real estate agents are now employing the latest in 3-D touring, allowing potential buyers to move through your home on their own by using software such as CloudPano and Matterport.
Finally, be very careful about pricing. There may not be much to choose from right now on the market for buyers, but with the global economy still adapting to changes, you must avoid overpricing your home.
Record Prices for Suburban Homes
Although the Covid-19 Pandemic has brought many industries to a halt, Americans are still buying homes, and demand is high while supply is witnessing record lows. According to one poll of real estate agents spread across the country, 75% reported that property prices are actually picking up steam or holding steady.
One factor that could be contributing to that demand is the fact that many people want to buy homes for working at home or as they make other life changes such as moving away from the Covid-19 hotspot of NYC, with companies like Twitter telling employees they have the option to work from home permanently. Considering the unique Covid-19 circumstances we are currently in, that’s something definitely worth noting as it’s a window of opportunity for home sellers worth exploring.
However, the US economic future is looking increasingly bleak. The longer you wait to list your home, the higher the risk of the value declining as the property market buckles under pressure from severe job losses and a recession.
Covid-19 Health Safety Issues
Although this is a scary time for you to be out checking out or selling properties in New York, that is still possible to do and stay relatively safe even in this Covid-19 hotspot. The housing industry is adapting rapidly, introducing new approaches designed to minimize exposure to the Coronavirus.
It’s safe, however, to say the days of elaborate home showings are gone where prospective buyers would meet by a smiling real estate agent or homeowner with a glass of wine and cheese, at least for some time.
For many real estate agents, for instance, most of their activities are being done virtually. Because home showings or open houses are not easy to arrange due to quarantine or healthy safety issues, New York City real estate listings agents are now offering virtual tours.
Digital closings, or “eClosings,” are according to sellers and buyers the ability to electronically sign settlement documents without having to meet in order to close the sale deal. Purchase agreements can now be drafted to include covid-19-based protections for both the seller and buyer.
Financial Considerations
It’s important to note that while current property market conditions are offering an incredible opportunity for buyers to leverage the historically low mortgage interest rates, these are actually shooting up rather fast. This is because so many individuals are refinancing.
Financing is likely to be stricter in the days ahead. For example, if you are applying for a new mortgage from JPMorgan Chase, you will need it becomes mandatory to make a down payment that’s equal to 20% of the value of the home as well a higher credit score.
This trend highlights how quickly banks are shifting gears in response to the darkening economic outlook in the US after government measures to contain Covid-19 put millions of Americans out of work plunging the economy into recession.
Therefore, if you wait too long to list your home, you could end up missing this money-saving boat being offered to potential buyers.
Residential Real Estate is Government Supported
In March, the Department of Homeland Security gave the property industry a big boost when residential real estate got classified as an “essential business”. This was after several states, such as Washington and California lifted their stay-in-place orders for real estate appraisers, agents, and title agents.
Banks are also offering a range of programs geared towards helping businesses and individual customers affected by the Covid-19 pandemic. These include deferred payments, fee waivers, and other customer customized accommodations. Fannie Mae & Freddie Mac, two government backed entities, issue over 75% of the mortgages in the US and continue to do so to help buyers take advantage of record low mortgage rates. These tailwinds favor home buyers’ ability to buy and potentially even afford a larger purchase.
Conclusion
The home sales outlook in New York is uncertain and will be very reliant on how the post-Corona recovery takes shape. Ultimately, the economic impact of Covid-19 and its implications on housing activity is going to be a function of the direct actions taken by stakeholders to combat its spread and the economic stimulus packages by the government.
The world is in the midst of a crisis and nearly everything is different now. True, we may never go back to the old normal but even this global pandemic will end. Your home will ultimately sell and the time to get it ready is now.
Schelton Assoumou is a New York based real estate investor specializing in the affordable housing markets with emphasis on the New York City, Westchester and Long Island markets. His practice has placed hundreds of tenants and invested millions for multiple institutional and individual investors in this sector.
