Due to the coronavirus pandemic, the San Francisco Association of Realtors (CAR) has banned all in-person property showings and has closed its offices. In addition to realtors not being able to show properties – appraisers, stagers and photographers can’t travel to properties. And, of course, no open houses means no potential buyers.
CAR polled its members and found that a large majority expected the crisis to bring down prices, sales and inventory. Sure enough, with so many sellers suddenly pulling their properties off the market, the number of listings has dropped dramatically.
“Before the coronavirus outbreak hit the state so severely, California’s housing market was getting a strong foothold,” CAR reported in a February market report. However, according to CAR economist Leslie Appleton-Young, – the housing market condition is expected to deteriorate in the coming months. She projects that sellers will hold off listing their properties until things turn around.
While the market has slowed down dramatically, it hasn’t come to a standstill. Many real estate agents are innovating, offering vide4os and virtual open houses and walk-throughs using navigable 3D models of properties. While this technology has been around and used by the industry for some time, until now it was viewed as second-best to in-person viewing. Given the unique nature of the current crisis, however, virtual tours might now well make a critical difference that keeps the market alive during this difficult time.
What does the future look like? In an article in CurbedSF published in March, author Adam Brinklow reported that there’s some history that suggests that hope for a real estate rebound isn’t just wishful thinking. Svenja Gudell, chief economist for Zillow, studied pandemic histories ranging from the devastating 1918 Spanish flu pandemic to the SARS outbreak of 2003 and noted that economies snapped back quickly once the epidemic was over.
When Hong Kong, a hyper-lux market like the Bay Area faced the treat of SARS, a disease that called for similar isolation practices we’re now facing, Gudell found that although transaction volume plummeted up to 72%, house prices did not fall significantly – nor did they fall in China during the novel coronavirus spread there only a few months ago.
Reprinted with permission of the Small Property Owners of San Francisco Institute (SPOSFI) News. For more information on becoming a member of SPOSFI or to send a tax-deductible donation, please visit their website at www.smallprop.org or call (415) 647-2419.