In the wake of the COVID-19 crisis, home buyers have not given up on the dream of home ownership, but many have modified their parameters, according to a survey conducted by our regional muliple listing service (MLS). Bright MLS polled 95,000 real estate professionals in Delaware, Maryland, New Jersey, Pennsylvania, Virginia, Washington, D.C., and West Virginia to glean their observations about changing buyer preferences.
Bright MLS reported four main trends among buyer preferences as observed by their Realtors—trends we are now seeing ourselves.
At the top of the list were buyers’ increased preferences for larger homes in less-populated areas. Reflecting increased at-home work habits, 31 percent of agents noted that their buyers are seeking homes with dedicated home office spaces. In addition, 26 percent noted that more buyers are looking for larger yards, and 21 percent of the agents noted that their buyers want less dense neighborhoods. Condos are much less popular too, with 70 percent of the agents reporting that buyers are now more focused on finding single-family homes.
We are indeed getting similar input from our buyers, although some are still looking at condos. One who originally focused on in D.C. town homes and condos is now looking out into the suburbs and rural communities within our region. “I value outdoor space and distance from other people far more than I did before, given the possibility of again being trapped inside during future pandemics,” she said. Yet D.C. urban living still has some pull as this buyer is open to finding a good deal in D.C., particularly if inventory opens and prices come down as others choose to move outside city limits.
While some of our buyers appear to have placed their home searches on hold, others have stepped up their timeline to purchase earlier than expected. “COVID-19 has sped up our home buying plans because we currently live in a multiunit building (with a shared elevator, common lobby areas) and feel less safe raising a newborn there given the global pandemic,” said another client recently. “While we were aiming to buy next spring, our timeline has moved up to this year.” Low interest rates have also enticed these buyers, but the low inventory has made things more difficult as “homes are flying off the market,” she added.
COVID-19 caused still another client to purchase a new home that she had no plans to buy before the pandemic hit. “My mother came to stay with me during the lockdown, and it became clear her current living situation can’t continue,” she said. “The solution requires changes all around.” So, during the COVID-19 lockdown, we helped her find a home to accommodate one-level living, equipped with many accessibility features for disabled and older individuals.
We’ve also found that the COVID-19 crisis has prompted some people to start thinking about buying a second home, near the beach or other attraction, as potential escape should there be more lockdowns in the future for this or another future virus. One of our past buyer clients, and now good friend, explained that the economic lockdown has her thinking about a second home. “House arrest, combined with uncertainly of what travel will look like down the road, has reignited my earlier thought to have a vacation place,” she recently told us.
Those changes make sense, but the second trend highlighted in the survey is more surprising to us. Realtors report that buyers are more willing to make offers and place under contract homes they’ve never seen in person. More than half said they had clients that are willing to rely on virtual tours alone before making an offer.
We have not seen that trend among our clients, and in fact, we have suggested they don’t place a contract on a home based on a virtual tour alone. Buying a home is one of life’s biggest decisions, and virtual tours are simply not the same as an in-person viewing. Armed with a spray bottle full of rubbing alcohol, paper towels, masks, and gloves, our buyers have safely viewed many homes during the COVID-19 lockdown.
In addition, we advise sellers to be cautious when considering offers from buyers who have not yet set foot on the property. If a buyer gets a contract on a home they haven’t seen in person, the chances of them exercising the home inspection or HOA contingency are likely higher than usual. It’s in the seller’s best interest to get buyers who are more committed to closing the deal, and in-person viewing helps cement that desire or cause them to look elsewhere.
The third trend found in the Bright MLS study is also technology related: More than half of the agents polled said they have become more tech savvy, which is certainly a good thing. Agents are now relying more heavily on online document signing services, online virtual tours, video conferencing, and conducting virtual showings.
While we’ve used many of these technologies before, we too are now doing buyer consults via Zoom or Facetime rather than at local coffee shops, for example. These face-to-face teleconferencing technologies have proved exceptionally helpful. Once past the COVID-19 crisis, we hope to arrange in-person meetings but will continue virtual meetings for those who prefer that approach.
The final trend Bright MLS reported is an unusually slow spring real estate market, which they contend is expected to lead to higher than normal activity into this summer and fall. Inventory has indeed been extremely low, making it exceedingly difficult for our buyers to find suitable properties. The properties that have gone live sell quickly, often going on the market just before the weekend with contracts reviewed the following Monday or Tuesday.
According to Bright MLS, 77 percent of agents reported that their seller clients were waiting to place their homes on the market until COVID-19 restrictions are lifted. Bright MLS reported that as markets have started to reopen, a greater number of listings are being entered into their MLS, which is good news. So, while the spring is usually the busiest time of the year for real estate, it appears that the surge in listing and buying activity will be later in 2020 that usual.
The take-away is that COVID-19 has contributed to the ever-changing real estate market. For sellers—particularly those with single family homes and yards—it’s an excellent time to sell, as limited inventory is pushing up prices in our region and leading to quick sales. For buyers, it’s been a time to reassess their wants and needs, and buying will require some patience as sellers begin to list properties and open their doors for buyer viewings.
Angela Logomasini and her husband Christopher Prawdzik are licensed Realtors® with Samson Properties in Alexandria. Operating as D.C. Region Real Estate, they serve the Virginia, Washington, D.C., and Maryland real estate market and offer comprehensive real estate services, including 4½% full-service listings.
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