The COVID-19 lockdown has affected the US housing market 2020, but that doesn’t mean there’s no activity at all. Here’s a guide on how to sell a home during these times.
Selling a house can be a headache – it could take longer and cost more than you think, and it can be an emotional drain. That’s in normal situations. Selling a home in a pandemic adds new safety concerns to the mix. So if you were planning to sell your home in 2020 (or perhaps already had your house on the market), the coronavirus pandemic has likely given you pause. And you’re not alone. Many people across the US have been gearing up for what was looking like a hot spring housing market, but now they aren’t sure what to do. Should they move forward with caution? Will buyers come? Is now a good time to sell or should they give it a year?
It’s natural for property sellers to have these questions as we retreat into the safety of our homes for the coronavirus lockdown. Today, having our own private sanctuary has never been so important. However, even during the COVID-19 pandemic, real estate transactions are still moving forward. Many sellers are still listing their homes and buyers are still buying, too. Selling a home amid the pandemic comes with some extra complications, but it’s not impossible. Seeing as this is new for everyone, we’re here to offer a guide on how to adapt and how to sell a home as safe as possible in 2020.
Can I Still Sell My Home During the Coronavirus Pandemic?
Before we jump into the steps to selling a home, we want to answer one of the most frequently asked questions by property sellers in 2020. Under guidelines from the White House, people nationwide are practicing social distancing measures to mitigate the crisis and flatten the curve. Until further notice, people must avoid gatherings of 10 or more people and perform work/school obligations from home when possible. Moreover, the majority of state governments are using “shelter in place” and “safer at home” orders to urge people to stay home except when needing to grab necessities. As you can expect, this adds extra challenges to the home selling process. Many sellers are asking if selling a home is even allowed during the COVID-19 pandemic.
It depends on where you live. The U.S. Department of Homeland Security had classified real estate as an essential service. Yet, states, counties, and municipalities can still create their own rules and affect what’s allowed. Some states that have issued “shelter in place” orders have declared at least some real estate services as “essential” and therefore allowed to continue operating. Among these states are California, Washington, and New Jersey. A handful of states, though, didn’t follow the same approach. If you’re in a state, county, or city where real estate has not been deemed essential, then services that can’t be done remotely (like inspections, title and escrow, and moving services) will be on hold.
Related: Real Estate Deemed Essential Business During COVID-19 Pandemic
According to the National Notary Association (NNA), As of April 3rd, 2020, 14 states have laws that allow Remote Online Notarizations (RON), and 12 states have enacted emergency RON measures in response to the coronavirus pandemic. Elsewhere, closing a real estate transaction still requires an in-person signing. Plus, rules and guidance around online notarizations – like which technology you need and whether notaries need to register – also vary across states. So, make sure to check the NNA’s website for updates and to see where your state currently stands. We also recommend getting in touch with a reputable real estate agent in your area to find out how local restrictions are impacting the ability to buy and sell homes locally.
How to Sell a House During COVID-19 Pandemic
If you’re allowed to continue with the real estate transaction in your area, here’s our step-by-step guide to how to sell a house in 2020 during the lockdown.
#1 Get Your Home Ready to Sell
Presentation has always been important to sell your house fast. But for those looking to sell in the current US real estate market, this has become critical. And when talking about presentation, we’re talking about both the interior and exterior of your home.
On the inside, you want to make sure that the home is clean and neat. This is especially important if you’re selling a rental property or a second home and you’re not the one living there. So, get on with de-cluttering. Take a look at the décor: decide what needs a coat of paint and rearrange furniture for good traffic flow. These are easy ways to give rooms a quick makeover and make property buyers feel comfortable as they tour your home.
Now is also a great time to make some fixes as you prepare to sell your home. For example, if you have a drywall patch that needs to be taken care of, now is the time to do it. Have a broken window? Fix it. Replace that broken mirror in the bathroom. Get those new doorknobs you have been meaning to get. There’s a lot of work that you can do to make the average home its well-presented best before listing it on the market.
Next up is to tackle those exterior projects like tidying up the garden, painting your front door, clearing gutters, and making small repairs outside to improve the curb appeal. Despite the COVID-19 pandemic, you want to keep your home “showroom ready”. All of this work takes hours, and you don’t normally have the time. Now, however, all that time freed up from not attending sports games, visiting family, or going out with friends can be well-utilized around the house.
Related: Buying and Selling Real Estate in the Time of COVID-19
#2 Have Property Inspection and Appraisal
Usually, it’s the property buyer who gets a home inspection before making an offer on a house. However, it’s in your advantage as a property seller to have the home professionally inspected to uncover any potential problems that can’t be seen. This step in how to sell a home can help avoid costly surprises once the home is under contract. In states and areas where home inspections are permitted, you might have concerns about how to keep yourself (and your home) safe during the property inspection.
These days, social distancing orders allow many inspections and appraisals to be done with minimal contact and with precautions to minimize fears and cross-contamination. For example, inspectors are asked to walk through the house by themselves, unaccompanied by the buyer, seller, or real estate agent. They should also wear gloves when touching anything in the home and consider wearing a mask as well. Property sellers might also ask the inspector to use a hazardous-materials uniform in order to provide a barrier between the inspector and the home. The property seller should also stay secluded in part of the home away from the inspector and wipe down everything with disinfectant wipes when they leave.
If the lender allows it, appraisals can be done alternatively. An alternative appraisal is a property appraisal that doesn’t conform to the standard Fannie Mae 1004 appraisal, usually because there isn’t an in-person interior inspection of the home. Instead, the appraiser uses exterior inspections, drive-bys, someone else’s inspection (like a home inspector), or even a video walkthrough hosted by the seller to assess the home’s quality and condition without having to set foot in the home. As a result of the coronavirus, the Federal Housing Finance Agency had permitted alternative appraisals to be used instead of a full appraisal until May 17th, 2020. This alternative helps in maintaining social distancing while obtaining a reliable valuation for both the property seller and potential buyer. So, make sure to ask whether such options are acceptable in your area.
#3 Price Your Home to Sell
We know that the US housing market 2020 was hot before the coronavirus hit. Sellers may still be able to grasp a value reflective of the economic expansion that preceded this pandemic. However, as tens of millions of Americans face losing their jobs, a coronavirus recession is looming or already taking shape. Real estate agents advise sellers to keep that in mind when pricing their homes. Pricing too high can backfire and cause the house to sit on the market for a long time. In the wake of this pandemic, you can take your time to set the right price that will attract buyers to your home.
Related: How the Coronavirus Will Affect US Home Prices in 2020 and Beyond
The best way to price a home is by running a comparative market analysis (CMA). Buyers usually do this to determine a fair offering price, so sellers should also do this to determine a fair asking price and be one step ahead. If you’re working with a real estate agent to sell your home, he/she will run a CMA and present a final report for free. But if you’re reading this to know how to sell a home on your own, here’s a quick breakdown of the comparative market analysis. Basically, what you need to do is find real estate comps: properties in your area that are similar to yours in size, features, are currently on the market or have recently been sold. Check how much these homes are selling for and price your home according to that average price.
Wondering how to find real estate comps? There are real estate listing websites and online tools that’ll give you an estimation of home prices in your area. Mashvisor, for example, uses predictive data and property data to analyze homes for sale in your city and neighborhood of choice. Based on these analytics, a property seller can easily find comparable properties along with their data to run a CMA in a matter of minutes. To learn more about Mashvisor and how we’ll help you make faster and smarter real estate investment decisions, click here.
#4 Use Virtual Reality & Online Marketing
As a result of social distancing measures and local laws in some states and cities, open houses are not currently available in many locations. That said, the rise of online and alternative resources in recent years has given buyers and sellers new options. Today, real estate agents have quickly adapted by using virtual open houses, digital closing tools, and remote client meetings. So if you want to sell your home in this day and age of technology, a video tour of your home is the best way to go in the US real estate market 2020.
Real estate agents are making themselves available over videos to walk potential buyers through vacant and newly constructed homes. When choosing a realtor to sell your home, make sure to choose one who can add a 3D or video walkthrough to your listing or hold a virtual open house using technology like Facebook Live. If you’re not comfortable with an agent or a photographer being in the home, ask your agent for tips on how to record your own video walkthrough and best practices for how to take listing photos with your smartphone. You can even post a video tour on YouTube or other video sharing sites so your home could be seen by thousands of prospective buyers from the safety of their own four walls.
#5 Reduce In-Person Showings
Showings that contain large groups of people are mostly canceled for now. Still, many property buyers will want to view a home in person before making an offer. As a property seller, you’re probably worried about having strangers in your leaving germs behind. This might lead you to stop in-person showings altogether. However, keep in mind that by doing so, it might take a bit longer to attract an offer. Furthermore, real estate agents across the US are taking extra steps to protect homeowners in places where face-to-face showings are still happening by only allowing showings in on a case-by-case basis.
So, discuss with your agent how to sell a home privately. You can do this by keeping showings exclusive to serious, qualified property buyers who’ve already done extensive research on your home. Ask potential buyers to provide proof of funds or a mortgage pre-approval letter before allowing them to book a tour. A real estate agent should also take measures to make sure a home is a good match for interested buyers. Some agents are conducting “preliminary” showings where a buyer comes to look at the street and exterior of the home before they book a tour of the inside.
In some areas, real estate agents are even using COVID-19 certification forms that agents, sellers, and buyers have to sign before entering a home. This certification represents that, to the best of their knowledge, all parties are not infected with and have not been exposed to the coronavirus. Finally, talk to your agent about local showings safety procedures, such as:
- Having buyers and agents drive separately
- Requiring buyers to wear masks, booties or gloves
- Making hand sanitizer and soap available with signs encouraging hand-washing
- Leaving all interior doors open and all interior lights on to minimize touching of surfaces
- Deep cleaning and disinfecting before and after tours
How to Sell a Home During a Lockdown: Final Words
Everyone can feel the effect of the coronavirus in 2020 including peoples involved in home sales. Actions that might have once needed a few hours or minutes to be completed might take longer now. Bur motivated sellers in the US real estate market are still listing. Many real estate agents believe that now is a good time to sell your home because many sellers are deciding to wait, which makes it even more of a seller’s market due to lack of inventory. And despite all the upheaval in the housing market, there are still buyers looking to buy homes. So if you know how to sell a home during the COVID-19 pandemic, you’ll have a good chance of closing the transaction even though it could take longer than usual.
For more information on the impact of COVID-19 on the US real estate market and how to buy and sell real estate during these uncertain times, read our blogs on Coronavirus real estate trends.