The recent push to social distance Americans from each other has had a unique effect on all types of businesses, including the residential brokerage market, which relies on face-to-face interaction to showcase homes and close sales.
National and county guidelines to restrict public gatherings and encourage residents to stay home whenever possible have prompted agents to cancel their open houses and broker previews.
For luxury brokers in Orange County, showing that unique coastal home to a pool of prospective buyers is now much trickier.
“This pandemic is certainly one of the most interesting things I’ve seen in my 35-year career,” said Steve High of Villa Real Estate. “It’s complicated the way we show houses, but nearly all buyers start their search for their home online, and it’s a good time for online shopping.”
This challenge is much more acute for owner-occupied homes, with sellers hesitant to show the home they’re currently living in.
Luxury brokers are now counting on online tools to present a property, including photography, videos and virtual tours.
“We’ve been trying out things like Facebook Live and Instagram Live to show properties,” said John Cain of Pacific Sotheby’s International Realty.
“Also, we can FaceTime the client to walk them through the house.”
Earlier this month, Compass sent out a companywide memo on tips for virtual tours. The firm is also developing software tools of its own to help agents, including a newly launched video template for “virtual open houses.”
“Most of us in luxury real estate already do property videos, and great photography has always been critical,” said Kathryn White, a local agent for the Softbank-backed brokerage.
“Still, buyers want to see the home in person before they buy, and there is ongoing demand for private showings, especially for unoccupied homes.”
The move to private showings has been extended to lower-priced homes, too.
Aliso Viejo-based homebuilder The New Home Company, which last week opened the final collection of homes within its Esencia neighborhood at Rancho Mission Viejo, said it is now offering viewings by appointment only.
It’s also touting a levy of online resources, including interactive Matterport 360 tours, videos, maps, image galleries and chat services with a dedicated online sales concierge team.
“We are committed to ensuring that during this unprecedented time, the best of our company shines through and we do everything in our power to put the safety of our homebuyers first,” the company (NYSE: NWHM) said in marketing materials.
As for business itself, there’s been an unquestionable pause in dealmaking as buyers and sellers consider holding out until the dust settles.
“The market did great during the fourth quarter, and that momentum was building until this put a stall on every business,” said John Stanaland of Laguna Beach brokerage The Stanaland Group, part of Villa Real Estate. “We’re all hoping it doesn’t last too long.”
The Federal Reserve’s decision to drop interest rates did pump confidence back in the market, Stanaland notes.
“That helps the real estate market whether financing is involved or not,” he said.
Brokers have seen several cancellations as a result of COVID-19, though that rate would be far greater if the Fed hadn’t dropped rates, according to High.
“While some have backed out of deals, or have perhaps decided to wait to buy or sell, we have seen some new deals come together in recent weeks,” High said.
“Intelligent buyers are seeing this as an opportunity.”
The lull in activity hasn’t yet led to a drop in listing prices, according to White, who notes that only a sustained pause in business would lead to a wider trend of lowered prices.
“I’m still getting calls for showings, and I’m hearing from title reps that they are opening new escrows every day,” White said.
“Still, we are in uncharted territory, and I know we are all hoping for a quick resolution.”
“It’s definitely a weird time,” Cain said. “But the strong underlying market fundamentals that we had before are still there now, and domestic buyers are still out there.”