Should you Buy or Sell a Home During the COVID-19 Pandemic?
We are here to help our clients in any way that we can, but we do want to let you know there is good reason to hold off buying to selling real estate right now unless you absolutely need to.
I can certainly understand feeling the need to buy or sell real estate right now if:
- you have (or are about to have) nowhere to live
- you bought a new home and still need to sell your old one
- you can’t afford your mortgage payments
- your tenant isn’t paying rent
- you think you’ll miss out on a deal
But if you can hold off, you probably should. This is an unprecedented global event, and no one knows how it will all play out. Things are changing by the hour. If you’re looking for an elusive deal, you should seriously consider whether risking your health is worth looking for a deal that’s probably not there. If you have a tenant, you probably will not be able to get any showings through, and will likely have issues at closing. If you can’t afford your mortgage payments, contact your lender and see what you can arrange – some lenders will defer your payments.
A Changing Landscape
As of this writing, there is nothing prohibiting the practice of real estate in Alberta (I will update this post with changes when needed), but, the practice has drastically changed over the past week or so. We are still working with clients, but have implemented some changes to our day to day business, some of which are included below. The industry is doing far more paperlessly and virtually than ever – all of our meetings are online and we’ve been paperless since 2006.
Listings
Our Association has temporarily changed a rule, allowing homes to be listed in the MLS® system database for up to 30 days without allowing showings (previously the rule was showings had to be allowed within 24 hours), so even though there are lots of listings to look at online, many sellers are not allowing showings at this time. Open houses were banned in Alberta on Monday (March 23) by the Alberta Real Estate Association, but many builder show homes remain open and non-regulated entities may also engage in open houses. If you’re thinking of listing now, you should know that buyers have toured listings in Edmonton already, that didn’t know they were infected with COVID-19 at the time.
Showings
There are some creative solutions to showing homes over facetime or video chat of some sort. Almost all of our listings have 3D tours that allow you to walk through them on your computer or mobile device. Video chat and online meetings are being used to discuss offers, listings, first-time buyer presentations and more. Digital signatures allow contracts to be signed remotely. If you want to see something in person, expect to be asked a series of COVID-19 questions at the very least, and expect that you won’t be able to see all the homes you want to see. We are recommending sellers have hand sanitizer at the property and leave all lights on and doors open. We also recommend disinfecting the property after each showing. An onerous task to say the least.
Deals
Expect deals to take longer to put together, more time is needed for conditions to be removed. If an in-person appraisal is needed you might not be able to proceed. Some home inspectors are temporarily shutting down operations, I expect more will follow suit in the coming days; if a home inspection does occur many are asking the buyers and their agent not to attend the inspection. We do not recommend buying a home without getting a professional inspection.
Closings
In terms of closing deals, it’s still possible in most cases – land titles is still open. Some real estate lawyers are meeting with clients over video chat, and then passing documents back and forth through car windows for signing. But what if a buyer is laid off after removing conditions and before possession? What if one of the parties to a transaction contracts COVID-19? What if the virus is transmitted to or from a buyer during a showing – are you opening yourself up to a lawsuit?
There are so many moving parts, and so much change occurring on a daily basis, it is time for caution when it comes to real estate in Alberta. It’s a time to keep yourself and others safe.
About Sara MacLennan
Sara MacLennan is the Director of Marketing at Liv Real Estate and a licensed Real Estate Associate. The bulk of Sara’s experience and wealth of expertise lies in on-line technology and marketing both for agents and consumers. Sara is the former National Director for Interactive Marketing for Coldwell Banker Canada where she was responsible for an extensive training program traveling to offices across the country training agents and brokers on marketing and technology. Find Sara on Twitter @edmontonblogger.