With the United States in its third straight month of solid job growth, there’s still more work that lies in front of us. Data from a Bureau of Labor Statistics report on August 7th 2020 shows that we have reached a national 10.2% unemployment rate but this is still above the peak following the 2008 recession. With government incentives like the Paycheck Protection Program being debated on and no vaccine arrival in sight, the three months of job growth could stagnate. I began to wonder how this combined with the national supplemental plans (like the $600 unemployment checks) expiring would trickle down to the housing market. Out of all the industries I look at residential properties are the key topic I can’t get a read on. Zillow claims the Dallas housing market on August 8th is a strong buyers’ market based on their algorithm reading the list-to-sale price ratio, the prevalence of price cuts on home listings, and the time on the market. But then Metrotex, the association of realtors for North Texas, released a June 2020 Dallas report showing that median prices are up 2% and active listings down by 20% compared to June 2019. This would indicate more of a sellers’ market. I reached out to Renae Anderson, a DFW realtor at Sage Street Realty, to get an understanding behind the changes to residential properties during COVID-19.
Hello Renae, which organization is giving a more accurate picture on the local housing market and how have realtors been adapting to that environment?
I would say that Metrotex has a clearer picture of the current real estate market in DFW. I am seeing myself and the work my agents are producing that there is quite an influx of buyers with low inventory, especially in the $200k-$350 range. I know for myself and the agents at Sage Street Realty that we adapt as we have before. I don’t feel that pandemic that affected the way we handle a heavy buyers or sellers’ market. We have to strategize and prepare our offers to cater to what the seller wants, while still providing value and sound housing to the buyers.
How has your business been adapting to remote open houses and how have you been able to gain high retention rates for them?
Some sellers are absolutely adamant that people do not walk through their homes. While our company has always done virtual open houses alongside an actual open house, I do think that there has been a shift in how everyone is doing them now. I am actually excited because we are really opening the market to who can attend these open houses. A physical open house restricts the pool of buyers to geographical locations and set times and hours. I feel like you can market these “remote” or virtual open houses better with systems like Social Media and Search Engines.
With local business bankruptcies, job losses, and home foreclosures, how has your marketing adapted to potentially heightened emotions online?
Our industry is fueled by emotions. I don’t know that we have had to adapt too much due the sensitive nature of our marketing. There are so many marketing restrictions that we must adhere to in the first place to ensure that we are following fair housing laws. Of course as home foreclosures are predicted to increase in the next 12 months I believe we will need to approach the solicitation of sellers who have fallen on hard times. But really I think the bigger need will be to regulate the predatory marketing that is done by people who buy homes and are not licensed and regulated by a local authority.
Have you seen or predict any remodeling trends due to COVID-19?
Absolutely! I have already seen a huge trend up for remodeling projects. Especially when we were shelter in place. Have you tried going to Home Depot lately? It’s a mad house. I think that the need to rearrange the home is in full swing. Now families are trying to accommodate for child school space, practice space, Work from home space. I think also that the in the future builders will accommodate these issue as well. To be honest, I think that this is why our industry is still doing as well as it is. More people are home realizing that their home is not working for them and needing to find more space.
With companies delaying office return dates and some even permanently making jobs remote, do you predict a larger increased interest in city properties, suburban properties, or rural properties?
I think that we will see an increased interest in suburban areas. I do think that there will always be a romanticism about the city, however, there is more space and bigger homes for the price in the suburbs. As people don’t have to worry about commute time I think these areas will be more appealing. However, I do believe that there is a place for everyone and some people will prefer one type of living to another.
Have you had to change any language in your contracts due to the anticipation of delays in the process?
None of the language in our contracts has changed due to COVID-19. However, we did get a promulgated addendum that we can optionally add called the COVID-19 Addendum. It does allow us to extend the contract closing date due to delays in Appraisals, Lending approvals, etc. I think this helps as people get sick, or have a more limited access with work from home issues. It has helped so that buyers are not losing money due to delays that were not their fault.
