It’s not unusual for the real estate market to be a little crazy during times of turmoil. Economic shifts, uncertainty, and unemployment can all wreak havoc on property values as well as mortgage rates. So, it’s not really that surprising that the real estate market is being affected by the current COVID-19 pandemic. But this time, things are little different. From real estate virtual tours to new real estate apps, the industry is clearly evolving. And it might be intriguing to see how things end up after life returns to some semblance of normalcy.
Real estate virtual tours existed before the coronavirus pandemic struck. But now, these are not simply convenient options but necessary tools of the trade. Certainly, safety is a key driver for many of these new real estate apps. But at the same time, home-buying trends are fueling these shifts as well. Likewise, many platforms are helping buyers better assess their risks of purchasing a home. Amidst a sea of great uncertainty and change, home-buyers are increasingly looking to technology to help them out.
“I’ve lived through the downturn in the ’80s; I’ve lived through the floods in the ’90s, the Y2K scare, the economic downturn, the hurricanes and the economic upheaval, and nothing has matched what we have undergone since March 10.” – Vicki Fullerton, Realtor and 2017 Chairman of the Texas Association of Realtors
The Suburban COVID Craze
The pandemic brought about immediate concerns about contagion and the potential spread of COVID-19. As a result, many people found that they were suddenly working from home most of the time. With many predicting remote work is here to stay, families are suddenly reassessing their home situation. Do they need to live in a congested urban environment? Can they get more value for their money elsewhere? Or perhaps most importantly, can I find an affordable home with enough space for an office?
Without question, COVID-19 has encouraged many people to look towards the suburbs for better opportunities. In fact, despite a drop in overall year-on-year home sales by 3.9 million, suburban home sales have risen sharply. In some cases, people are even exploring their options hundreds of miles away in other parts of the country. These trends, combined with the need to be protect one’s self from infection, have driven real estate virtual tours. And at the same time, a number of real estate apps have also emerged to facilitate the home-buying process.
“Not only did [the pandemic] slow the market down, but it changed everything. It went from [being] a real personal, one-on-one experience … to not being allowed to have open houses … sanitizing everything … doing virtual showings. Things definitely changed in that realm.” – Marc Wade, Realtor with Red Door Realty & Associates
Providing Reassurance Amidst Uncertainty
In addition to changes in work environments, COVID-19 has also disrupted employment in general. Travel and tourism sectors have been hit especially hard. Likewise, service and entertainment sectors are suffering. The effect that this could have on real estate is obvious. Higher unemployment rates will likely mean mortgage defaults and a rising inventory. While this may cause home prices to drop, it’s tough to know the optimal time to purchase. And of course, the emergence of a vaccine for the coronavirus would certainly affect the market as well.
(Uncertainty and setbacks are part of life. To read more about how some have faced obstacles, check out Ed Kopko’s book, PROJECT BOLD LIFE: The Proven Formula to Take on Challenges and Achieve Happiness and Success!)
While real estate virtual tours provide safety in viewing a home, some also help home-buyers assess their risk. For example, one of the real estate apps, Homesnap, lets consumer take a picture of a home they like. The app then provides images of the home as well as estimated value, school ratings, and more. Zillow and Trulia are also real estate apps that offer market-based information, trends, and other details about homes. And other real estate apps, like Home Spotlight, inform home-buyers about natural disaster risks and past insurance claims. It could be argued these apps are just as important as real estate virtual tours in this time of COVID.
“While various video technologies are changing how we travel and what we need to see live, I would not advise nor endorse buying any real estate sight unseen. It can make sense to put a property under contract before visually seeing it, but not to close on it without seeing it live.” – Bill Nimmo, Head of Wells Fargo Private Bank Real Estate Management Group
The Limitations of Real Estate Virtual Tours
As you might expect, many people are performing real estate virtual tours using Facetime and Zoom. However, there are newer real estate apps that provide better quality and better experiences for homebuyers. For example, HomeRover has enhanced features specifically designed to better explore a home. Many consumers are finding these improvements necessary, especially when they’re trying to avoid a tour in-person. And other real estate apps, like AroundMe, offer a way to virtually explore the neighborhood for other amenities. It’s impressive how much can now be learned through real estate virtual tours and related apps.
While advances in real estate virtual tours are impressive, experts advise not to rely on these alone. They might be ideal for narrowing down your options while avoiding exposure risks to illness. But when it comes to a final decision, an on-site visit is strongly encouraged. The subjective feel that you get from a home and other intangible pieces of information are important. Nonetheless, real estate apps offer important insights that can help make you decision better informed.
A Technological Shift Thanks to COVID-19
With the pandemic, consumers have become more accustomed to videoconferencing and online grocery shopping. The same level of comfort is likely to evolve with the real estate market as well. Online real estate sites are now preferred by many looking for homes. It’s not hard to imagine the same will transpire for real estate virtual tours as well. While some limitations exist, other real estate apps now complement these remote home walk-throughs. As a result, homebuyers are more able to gather the information they need to make better choices. While risks will always persist, technology is helping consumers navigate the modern real estate market. And thanks to COVID-19, it’s a pretty complex one at the moment.