Wednesday, September 2, 2020

Quoted in today's Sacramento Bee in an article about the real estate market...

I was quoted in today's Sacramento Bee in an article by Tony Bizjak about the Sacramento real estate market. The headline of the article is a little funny to me -- as prices increase, so (generally) does home equity. Clearly this is great for homeowners and sellers. Higher home prices - not so great for buyers.

Things are complicated.

As I have mentioned before, we have an imbalance of supply and demand in the market right now. This stems from fewer than normal sellers listing their homes, and a high number of buyers who are highly motivated to purchase homes as we are all spending so much more time at home now.

Sellers who would otherwise list their homes are faced with several challenges that are unique to our COVID19 environment:

  • Some contractors are reluctant to do repairs or remodeling in occupied homes. This makes things a little more difficult to prepare homes for sale.
  • The courts were closed for a prolonged period of time. Courts are now open but caseloads are backed up. Petitioners for probate have had a much longer wait to receive their "orders and letters" needed to appoint a personal representative. Personal representatives, who have authority to act on the estate's behalf, can't prepare or list homes for sale until their authority is ratified by the court. 
  • Estate liquidators have some challenges selling the contents from the homes of those who have died. The traditional estate sale is just not really feasible right now due to social distancing. This affects homes in trusts and in the probate process, and these properties now take longer to clear out.
  • Ever try to clear out a home yourself where someone has passed away? It it emotionally draining and physically difficult! It takes a long time under normal circumstances, and longer when people are reluctant to come to a garage sale.
  • At a time when everyone is supposed to be social distancing, many sellers are not excited to have dozens of people in and out of their homes for showings! Not only can it be overwhelming to sanitize between showings, but many sellers do not want to take the risk of exposure COVID19. While buyers and agents must provide a health declaration swearing they do not have symptoms of COVID19, there may be asymptomatic carriers of the virus who access the property. 
  • Spending so much time at home, where can you go during showings? It is best to leave during showings, and many local businesses are closed. Travel is not as easy as it used to be, so it may not be super convenient to pack up the kids and pets to leave.
  • The kids are going back to school! Seriously, now that so many people are working from home and kids doing distance-learning during the day, who has time to sell the house? And how much more disruptive will a move be?
  • If you have a home to sell in order to purchase your next home, with such low inventory, what will you be able to buy?
  • Some sellers want to wait things out and get past the COVID19 situation to a time where things are more predictable and certain.
These are common things I hear from people thinking about selling. And for some would-be sellers, sometimes these challenges are insurmountable. I thankfully have been able to work with and around most of these scenarios with sellers. I have numerous inspectors and tradespeople I can refer who will work through these conditions. I have a really creative estate liquidator who has pivoted to virtual estate sales and some creative online sales techniques. There are viable alternatives in many cases. But things are slower moving for sure.

With low inventory and LOTS of interested buyers including more than usual bay area transplants, it can be a good time to put your Sacramento home on the market if you have a well-crafted plan and circumstances allow.

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