When selling a home during coronavirus first, take a step back from the virus and consider your situation. Evaluate your financial requirements, assess your home, market your advantages, then take a deep breath, and consider the challenges brought on by COVID-19, they might not be as impossible as they seem.
Miami has enjoyed a strong real estate market with its tax incentives, growth rate, amenities, and quality of life making it an appealing city for would-be buyers and investors. What has changed with the challenges of 2020? If you’re a seller, does the pandemic put you at a disadvantage?
The Miami Market
Miami has invested in its reputation for offering local amenities, beautiful beaches, and a diverse mix of cultures, foods, and entertainment. Pre-COVID-19, the median home value was above $350,000 with an average home lasting 140 days on the market. In 2019 the Home Sales Report showed some positive statistics for sellers.
Average seller in 2019 realized price gain of $65,500, a 30% increase from 2018
Return on investments was an average of 34%
Miami attracts both domestic and international buyers
Northeast buyers are interested in Miami (shown in 2019 third and fourth quarters)
The sales trajectory caused by coronavirus has been somewhat unpredictable, already surprising top realtors throughout the country with April sales being significantly higher than sales from March. It’s clear that sellers and buyers both were exercising caution at the onset of the pandemic and that they are beginning to move back to normal activity.
This caution is consistent with other, smaller scale, pandemics in recent history, as well as with larger-scale tragedies like 9/11. Real estate data tells us that the country freezes for a moment and then fights to push forward and restore balance.
Staying Steady
Even with the uncertainty of coronavirus, Miami sellers aren’t reducing listing prices, and there are still active buyers. Though the number of buyers has decreased during the pandemic, internet search engine data indicates that many are simply waiting in the wings.
What do steady home prices indicate?
The main thing to keep in mind is that the coronavirus has slowed the market temporarily and unlike an independent economic housing crisis, the real estate market will likely enjoy a quicker return as the country implements phases to resume normal operations.
Steady prices indicate that there is enough market interest to reassure sellers that this state of being is temporary and there is confidence that buyers are out there still seeking to invest in property.
Don’t Worry If Your Home Sits
If you are unsure about listing or leaving your home on the market during corona, there are a few things to consider. Elements that would normally harm your sale potential - like remaining on the market too long - don’t carry the same negative weight as they normally would. There is an understanding that all processes are slowed due to the virus, so the stigma is removed as buyers are suspending assumptions that a long-listed home is overpriced or in need of repair.
Some multiple listings services are even halting the accumulation of days to better serve the sellers and portray property value and accuracy during coronavirus.
Buyer Activity
There is still action among Miami buyers. For Miami, April showed elevated sales for mid-market and $1-million-plus sales which contributed to the month’s increases. Single-family home sales increased about 22.8% from the previous years, and Miami condos priced between $300-400k had increased by 44.2%
More modest budget buyers are approaching this time with a little more hesitation but that doesn’t mean they aren’t actively purchasing.
An April 2020 Zillow report, as well as interviewed real estate agents showed mid-range single-family homes holding their prices, and an increase in pending sales of 6.2% as of mid-April – there has also been a12% increase in mortgage applications for the same period.
For Miami specifically, stats are also up; like in the neighborhood of Miami Shores where April saw 22 pending sales and 12 closed contracts, (an increase from the 9 seen in March). Market research shows that North Beach, Miami Beach and its surrounding neighborhoods have experienced steady 1st quarter closing sales with 769 sold properties, and also show an increase of nearly 10% in the sale of single-family homes compared to this time last year.
Selling at a Distance
Patience is no longer a virtue; it is a necessity when it comes to selling your home. There will be delays but there are also things you can do to ease the process.
Embrace the world of virtual home tours, long-distance negotiations, and longer wait times between accepting an offer and closing the deal. One of the biggest challenges of coronavirus is what it has done to our ability to meet and expedite actions like home inspections and appraisals but before you get to that point, you have to attract a buyer.
Online Operations
For-sale properties that are occupied by owners are relying heavily on virtual home tours where much of the interest is generated sight-unseen until a serious buyer emerges, with many closing walkthroughs happening over video call. In this regard your property type matters. Are you selling vacant or occupied?
Presentation is key, and your realtor can help.
• Make sure your home is well-staged
• Use pictures taken with a professional camera
• Provide more photos than normal and include videos for virtual tours
• Show street views and highlight neighborhood statistics
Your online image is more critical now than it ever has been. Distance buying has highlighted the importance of presentation. Choosing a trusted realtor with an established, well-trafficked platform, and experience in marketing properties is critical.
COVID-19 Clauses
Your contract will likely include a COVID-19 clause – your realtor will have all the latest information regarding COVID-19 stipulations and negotiations when it comes to closing. COVID clauses protect both the seller and the buyer addressing items like finalizing lending, virus-related illness, and timelines and delays due to social distancing.
These clauses are important to understand as they will linger in contracts for months, even after most of the country has re-opened. We can safely guess that we will see coronavirus elements over the next 1-2 years.
Timeline Expectations
The legal and lending aspects will be delayed with longer underwriting turn times and holdups as COVID-19 clauses are negotiated into contracts. Home inspections have also been delayed by shelter-in-place orders.
A good tip is to select a realtor who has taken the initiative to help facilitate remote home inspections and appraisals, as well as has the ability to conduct business virtually. Prepare for delays at multiple points during the process:
Attracting a serious buyer
Loan processing delays for buyer
Receiving buyer’s mortgage approval
Remote home inspections/appraisals
Clearing the title
There is a lengthier wait time on the policy aspects when selling a home during coronavirus but as a seller you can use negotiation tools to set extensions and manage the timeline so that everything stays on course to close – another element of COVID-19 clauses.
Quick-Selling Factors
There is no formula for selling a home quickly in today’s environment but there are factors that contribute to quicker sales, and they are the same factors that existed pre-pandemic. The biggest thing to remember is that the process for selling a home may be altered but the qualities that attract buyers are still the same.
Price
Marketability
Local Amenities
Location
Neighborhood Statistics
If you need to sell your home quickly due to a move coronavirus related reason, don’t be discouraged by the market – the landscape is still positive for sellers and is showing signs of consistent improvement. Be ready for a slower process but utilize the internet, marketing strategies, and a trusted agent to help attract the active buyers that are out there.
How we can help
Reaching out to a real estate agent during this time means you’re getting expert advice on how coronavirus relates directly to the selling of your home. We can help you go through your financial and policy concerns, detail the current market statistics for your neighborhood, and outline how the current state of things can affect your timeline. We are tracking the ever-evolving regulations especially now as Miami is preparing to head into the first phase of reopening.
At Urban Resource, our team has dedicated its time and creativity to bolster our already established communication and virtual capabilities to showcase your property to its best advantage. Our agents know the market well and our resources, knowledge, and connections are available to make the process as seamless as possible from financing to closing.
At Urban Resource, our team is here to help you sell your home today. Reach out today for more information: realestate@urbanresource.com
