As limits on homebuyers and sellers ease, what will the market be like? - Buffalo News

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Vienna Haak is anxious to get back to buying and selling houses.

Like many brokers, the real estate agent at Howard Hanna Real Estate Services has been doing deals during the past couple of months, but everything has been virtual and electronic because of the Covid-19 "pause" on business. But the buyers and sellers are still out there. And financial concerns haven't been a barrier for the buyers who are scouring the market for a home, especially with interest rates so low.

So she expects her clients to jump back into the market with gusto when the state lifts the executive order restrictions on the industry, as soon as next week.

"My clients and I cannot wait to get both feet back on the ground running full speed ahead," she said. "Hopefully the days of forcing a buyer to buy their home site unseen are over."

Real estate open houses and in-person showings will be allowed once again in Western New York under the phase two reopening that could begin as early as Tuesday. But it will be different than before the pandemic.

"It's not business as usual," said Annabelle Aquilina, an agent with Hunt Real Estate Corp. "There will be a lot of changes in how we will do business moving forward."

The local housing market has slowed during the shutdown, with showings limited to vacant homes. Sales during April plunged by more than 60%, and so did the number of homes being put up for sale during what normally is one of the busiest times for selling homes. But with the number of sales at a record low, home prices have kept rising, with enough potential buyers scurrying over the relatively small number of homes they have to choose from.

Reopening could change that, prompting more homeowners to put their houses on the market, increasing the region's limited supply of available homes, and encouraging buyers who remain financially secure to start looking more aggressively. The question, though, is how the region's high unemployment rate, estimated at around 25%, will affect demand as those jobless workers wait for the call to return to work and wonder if temporary layoffs will become permanent.

"Those people are not going to jump into the fray until their employment situation stabilizes," said Susan Lenahan, an agent with M.J. Peterson Corp.

For now, while Haak anticipates a return to individual home showings in person, she's not in favor of hosting public open houses anytime soon – even though they will be allowed.

"I don't want to put myself in a position to have to monitor the comings and goings of visitors," she said. "If buyers are ready, willing and financially capable of purchasing, a private appointment following CDC guidelines would be best practice."

Haak isn't alone in her hesitation.

"I don’t see how we’re going to be able to do open houses very quickly," Lenahan said.  "That’s probably not going to happen."

[Related: State loosens rules on home showings: Here's what's changing]

The state on Friday issued new interim guidance for residential real estate – which will remain in effect during New York's ongoing state of emergency – that provides minimum standards for showings, open houses and other real estate activities to occur. It applies to real estate agents as well as home inspectors, appraisers and property managers.

Agents, buyers and sellers must use masks and sanitizer, follow social distancing, and adhere to limits on the number of people that can be present in a home. Houses must either be vacant or the homeowner or lessee can't be present. Visits should be scheduled and staggered, and buyers need to wait their turn before going in.

Agents say that's fine for an individual private showing, where the agent can control the situation – although it also assumes all agents and brokerage firms will comply with the rules, which hasn't been the case already.

"It's chaos out there," said David Weitzel of Re/Max North, who says he has followed state guidelines when taking clients through homes, but has seen others disregarding them. "Everyone says no in-person showings but listing agents are telling people on the phone they do not care, and buying agents are walking through with clients regardless."

But when it comes to a public event, the rules impose a host of burdens and responsibilities on agents and the brokerage firms they work for. It also makes the events more complicated and cumbersome to run.

"The state requirements will be a daunting task to comply with, as well as the documentation to accompany it," Weitzel said. "Considering how many people are in violation of the rules currently, we will have to see if if all brokerages will actually implement the requirements."

The agents also aren't keen on exposing themselves or their clients to the risks of an open house. Nor do they expect the events to be very popular for the time being, because of public perceptions.

"Virtual tours and virtual open houses have been successful," said Louis Vinci, another Hanna agent. "I don’t see traditional open houses or tours returning, until we have a vaccine in place."

Besides, they've been able to manage with online photos, videos and even 3D tours for the past two months, satisfying buyers enough that they're signing purchase contracts essentially sight-unseen. Hanna this week even introduced virtual open houses through its website.

"I expect virtual to stay popular well into fall," said Greg Straus, co-owner of 716 Realty Group. "If I am certain of one thing in today's real estate market, it's that ready, willing and able buyers are comfortable buying a home online, without stepping foot inside. It's working and it's being done safely."

Agents say the market has remained solid throughout the pandemic-produced state pause – driven by pent-up demand, low interest rates and a scarcity of available homes.

As before, the most attractive and well-priced homes are selling quickly.

"The market is going crazy right now, even before it opens," said Bonnie Clement of Hunt, citing a home in Akron that was listed for $139,000, and received 40 offers. "We are so busy. There’s nothing but multiple offers everywhere. It doesn't matter what price range it is."

That's not to say there hasn't been a precipitous drop in activity since the mid-March business shutdown, especially new sales. Roughly one of every four workers in the Buffalo Niagara region has lost a job, either temporarily or permanently during the pandemic. That's caused some potential buyers to pull back for now.

According to data from the Buffalo Niagara Association of Realtors, pending deals in Western New York plunged 62% in April, from 1,108 a year ago to just 421 for this year. New listings plummeted 64%, from 1,546 a year ago to just 565. But with few homes available, the median sale price was up 15% in April. And agents expect business to pick up again as the economy reopens, especially now that the prime selling season has begun.

"We’re already starting to experience kind of an avalanche of activity, of people just champing at the bit to really get going," said Jerry Thompson, broker-owner of Century 21 Gold Standard in East Aurora.

Perhaps most of all, buyers haven't been deterred by their inability to get into homes.

"People are buying homes virtually. They don’t have to go in," Clement said. "It’s insane. And we’re exhausted."

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As limits on homebuyers and sellers ease, what will the market be like? - Buffalo News
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