The coronavirus has by now touched every aspect of daily life, inspiring fears of both economic instability and the outside world more generally. It’s been a particularly challenging and uncertain time for real estate, with the current pandemic reshaping both high-level market forces as well as the ground-level process of buying and selling property.

During a moment of increased caution and restricted movement, a New York Times article demonstrates how real estate agents have drastically augmented their process for showing and selling homes. That process involves everything from enhanced cleanings before and after showings to restrictions on touching certain fixtures, countertops, and appliances. Instead of truly “open” open houses, prospective buyers are sometimes forced to preregister so sellers and brokers can gauge how interested they are in buying—and make sure they’re feeling healthy enough to come by. The fact that sellers are increasingly shut in at home also makes setting up viewings more difficult.

That’s added up to a significant decrease in showings. According to data from New York metro area company Halstead Property cited by the Times, there were only 3,900 showings scheduled (not counting many cancellations) for the weekend of March 14–15, down from a typical 5,500 to 6,000. In some cases, pre-filmed video walkthroughs or FaceTime tours have filled the gap. But some, like William Raveis NYC managing director Kathy Braddock, concede that this has its drawbacks: “Obviously, being able to go see the property is the best way to see the property,” she told the Times.

Beyond the complicated logistics of realty in the time of coronavirus, the situation has sent conflicting signals to buyers and sellers as the threat of a recession looms. Despite the New York area emerging as one of the U.S.’s epicenters of the coronavirus, an Olshan Realty report found that 21 Manhattan apartments priced at or above $4 million were sold during the week ending March 15, up from an average of 19 for the first 11 weeks of 2020. However, the dollar value of these transactions ($128.5 million) fell significantly from the prior week’s roughly $216.7 million.Become an AD PRO Member

Those statistics seem to track with the subtle shifts in buying-and-selling behavior observed by a flash surveyof more than 70,000 National Association of Realtors residential members from March 9 and 10. While the majority of members reported no change to buyer and seller behavior as of yet, 9% say they’ve seen an increase in sellers as a result of favorable borrowing rates rates they hope to take advantage of by selling quickly and then moving.

However, buyers seem less optimistic. Thirteen percent of all NAR members noted decreased buyer interest in their given market, with a further 3% observing a significant decrease. Those decreases were even more pronounced in Washington (16% decrease, 3% significant decrease) and California (16% decrease, 5% significant decrease), two of the emerging West Coast epicenters of COVID-19 cases at the time of the survey. That disparity in interest could create a climate that’s ultimately favorable to buyers, but it’s too early to tell what course the situation will take.

The lack of certainty around the situation has encouraged some larger commercial real estate players to pause their acquisitions for the time being. According to Crain’s Chicago Business, Origin Investments has “indefinitely postponed” $241 million worth of apartment building deals out of fears they may be overpaying in a declining market.

“The market has changed, and our pricing needs to reflect the new normal, because closing at these prices today would undoubtedly lead to lower performance than our initial projections,” Origin principals Michael Episcope and David Scherer said in an email. “We believe this is a time to take risk off the table.”

Given how both the scope of the pandemic and the nature of governmental responses to it seem to change practically by the hour, it will be hard to predict exactly where things stand in the real estate market. With Fannie Mae, Freddie Mac, and HUD announcing a moratorium on all foreclosures and evictions through the end of April, it’s possible that the situation could stabilize before anything too drastic happens. Still, the one thing you can count on at a moment like this is to expect the unexpected.

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