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Real estate adapts to COVID-19; impact could be reflected in April numbers

David Floyd • Mar 29, 2020 at 8:20 PM

Hosting virtual tours and wearing gloves and masks, local real estate agents are making changes to how they show houses as precautions against the novel coronavirus (COVID-19).

“We’re just doing whatever it takes to make people feel safe,” said Kristi Bailey, president of the Northeast Tennessee Association of Realtors.

Colby Hurd, principal broker and owner of the Red Door Agency in Kingsport, said his agency’s support staff is working from home, and real estate agents are wearing gloves and masks when they show houses if they can.

When he conducts showings, Hurd said he ensures all the doors are open in the house so potential buyers don’t have to interact with frequently touched surfaces like doorknobs, and he only allows the person interested in the property in the home during tours. The process of closing on home sales has also changed, with closing companies keeping buyers and sellers apart.

Many showings are also done virtually — oftentimes through FaceTime, Skype or by uploading video tours to YouTube. Hurd said virtual tours were already a fairly common occurrence for out-of-town clients.

At this time, Hurd said he hasn’t seen a change in real estate activity as a result of the virus. If anything, Hurd said activity has increased.

That could easily change, Hurd said, if the state implements a shelter-in-place order. “But right now we’re rocking and rolling,” he said.

The biggest existing problem for the local housing market, Bailey said, isn’t necessarily the coronavirus. It’s low inventory, which she said has been an issue for a while. At the end of February, the local housing market had 3.4 months of available housing stock.

But, COVID-19 has created some uncertainty. In a column this week, Bailey said COVID-19 will push the region’s prime buying and selling season into “uncharted waters.”

Economic data points like home sales, employment and new home permits are considered “lagging” indicators because they describe housing activity in the previous month, and Bailey wrote that the numbers released in April will be the first to provide an indication of the full economic effects of COVID-19 on consumers.

Bailey warned that they could end up being troublesome. but she has an optimistic outlook on the market’s ability to weather the outbreak.

“The one thing real estate professionals are confident about is the housing market will weather this event,” Bailey wrote. “The local housing market is resilient, with consumer confidence being the driving force.”

NETAR data analyst Don Fenley said Friday that April and May could end up being tough months, but he doesn’t believe the impact will be truly reflected in numbers released for March.

“The real estate industry, like all other industries, is adapting to having to work under new conditions,” Fenley said, reiterating that real estate agents have changed how they do business to respond to the virus. Those adaptations, he said, are occurring in many other business sectors.

Bailey said Friday that buyers don’t appear to be slowing down right now, but sellers are holding back a bit. She said inspections, appraisals and existing transactions are still moving forward.

“It’s really not been an impact like you would think,” she said. Bailey doesn’t expect the market will change much unless there are more cases of COVID-19 in the area.

Bailey said serious buyers, rather than more casual ones, are more likely to be searching for a home in this environment, which could mean houses will have fewer simultaneous offers.

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