Impact of CoronaVirus on Miami Real Estate
The global CoronaVirus pandemic is unlike any other event that anyone living today has ever experienced.
Just over a week ago my Team and I worked towards an Open House on one of our listings.
We door knocked neighbours and even though something was boiling in the air, we were determined to make the Open House a success. We door knocked the entire neighbourhood and due pandemic panic decided to take a short break and go to near by stores, before coming back to finish one of the islands where the property is located.
It was going into late evening, that day we must have spoken to ~300 neighbors. We were getting exhausted when I received a text from the Home Seller, that she does not feel good, is home bound and given the CoronaVirus threat, would like to postpone the event. That was a first in my career as a Realtor.
I have never had an Open House cancelled by a motivated Home Owner. Yes: rain, hurricane, but never because of a Home Seller.
I was in front of the house the following day, greeting some of the brave visitors, getting their contact info and promising to be in touch when there will be some clarity on CoronaVirus threat and ultimately Real Estate as it partakes to my industry.
So how is the CoronaVirus affecting Real Estate today and what is ahead of us in the future?
It is too early to say. Many colleagues posted that they are ‘monitoring’ the situation. I am really confused how Realtors, can monitor the situation. We are not medical staff, we are not government officials, but apparently we are…
Others say that it’s business as usual. Well good for them. In my world:
- Schools are closed.
- Restaurants and majority of local businesses are closed
- Parks and outside areas run by the State are closed
It’s not business as usual! Every business, big or small has to take precautions.
In the area my Company operates in, condo-buildings don’t allow access to Realtors for showings. A Closing that was supposed to take place this past Friday has been postponed due to government offices being shut down. Another Client texted me this week asking what it will cost him if he decides to back out of a deal, as his company is making cuts. So business as usual? Unlikely.
Just over a week ago I was showing condos to New York buyers who have their home under contract. Their Buyer just backed out due to the virus, so they can’t buy any more. The CoronaVirus has a trickle affect on Real Estate and it’s not pretty.
On the positive side a property I submitted an offer on, couple of weeks ago, and was in the multiple offer situation, came back on the market due to CoronaVirus threat and Buyer feeling uncertain, backing out. Surely we are putting another offer in.
Real Estate Industry adjusting to CoronaVirus
Showings and Open Houses have been postponed indefinitely so the Real Estate industry is adjusting to a new normal.
Our company is a long practicer and preacher of video marketing, now even more than ever we are implementing video for every single listings and offering 3D walkthroughs as well as virtual and Live Facebook Open Houses, and one-on-one video calls. I am offering Zoom listing appointments, 3D video tours on listings, and virtual showings.
Virtual Home Buying and or Selling is nothing new in Miami Real Estate. Majority of Miami Condos are built on foreign funds, owned by foreign buyers, who are able to make a buying decision remotely without ever seeing a property they are buying.
We offer virtual consultation, we guide you over your priorities. Most of our buyers are remote.
Some of my Colleagues have already implemented virtual Open Houses and are doing a phenomenal job.
Some using an opportunity sending out #CoronaDeals… Not classy, at all. We all have to remain human first and foremost.
None of us have any idea what health risks and complications our Homeowners and Buyers experience, in some cases they don’t even know.
This past week, it was determined that the force majeure provision (unforeseeable circumstances) of the FAR-BAR contract (the standardised Residential Contract for Sale and Purchase) did not cover pandemics, therefore contracts could not be canceled for this reason. Further, a new Addendum has been created with the following wording:
‘The Coronavirus (COVID-19) pandemic may cause unprecedented impacts to real estate transactions, including but not limited to travel restrictions, self-imposed and/or governmental required isolations, potential closures of offices and institutions required to fund, close and record real estate transactions, and actions or inactions of a homeowners’ or condominium association (“COVID Restrictions)’
Temporarily Off Market maximum time limitation has been extended from 30 to 90 days to accommodate Sellers who want their properties temporarily off the market during the COVID-19 Restrictions.
Interestingly with interest rates at historic lows, coupled with the fact that people are spending more time at home, there has been an uptick in online home search activity.
How does this effect every day real estate transactions? Deeds can be electronically recorded. However, other time-bound processes, including inspections, appraisals, and municipal lien searches, have been impacted. The real estate community is working to determine how to move forward.
Real Estate Market Crash?
Real Estate Market has to adjust rapidly. The market will definitely cool off. Only the truly brave and seasoned investors will see an opportunity and go for it. When many Buyers will be backing out of deals, the savvy investors will jump on the opportunity. As the famous saying goes:
“Wherever the crowd goes, run the other direction. They’re always wrong.” – Charles Bukowski.
Some will be forced to sell their homes due to loss of income and businesses shutting down due to the pandemic.
Is this Real Estate Market crash everyone has been waiting for since 2008? Quite possibly. Just look at the numbers below:
Miami Dade County Real Estate Market Statistics:
|New Listings||Pending Sales||New REOs (Foreclosures)||Temporarily Off Market|
|Week of Mar 9th (pre-CoronaVirus)||965 New Listings||444 Pending Sales||20 New Listings||97|
|Week of Mar 16th (CoronaVirus)||682 New Listings||282 Pending Sales||29 New Listings||176|
To summarise, our guiding principle safety is always first. Even if I am not sick, I might be putting others in danger by physically showing homes at this critical time. My Clients know that I am here support their decision to wait or move forward.
Yes, there is a lot of media hype out there, but the threat is real. We will see a lot of changes shaping the Real Estate industry going forward and will do whatever we can to handle this. We are already adapting new technologies and being creative in these challenging times. For some this might also be an opportunity to get on Real Estate ladder as there likely will be more price reductions and distressed properties flooding the market.
We are all in this together. Stay home, stay with your loved ones. How many times you wished you could just stay home? Now you can. Stay home, stay safe, we will get through this together.
Thank you for your trust and continuing support. I know you have a lot of choices when it comes to Real Estate, and I am honoured I get to be one of them.