As the coronavirus crisis continues, more states and cities are enacting stay-at-home orders. As long as the crisis lasts, it won’t be the best time to sell your home, but some families have no choice.
Despite forbearance policies that allow homeowners to delay monthly mortgage payments, many breadwinners who have lost their jobs can’t pay their bills. Some will decide to move to find new ones. To access their equity, other owners will sell their homes and rent. Some communities are experiencing high mortality rates, and many heirs are selling family homes as quickly as they can.
In even the hardest-hit markets, selling a home on the local market is possible, but not easy. Many owners may look to use “cash for homes” options or utilize an iBuyer platform, which would cause them to sell at a discounted price. If you have several months and want to make the most return, selling on the local Multiple Listing Service is a better choice.
Here are six tips to help sellers overcome the most difficult circumstances.
Find an Agent Who Works Frequently with Social Media
Brokers and agents who are experts at marketing using social media will be more successful during the outbreak. To put sellers at ease, brokers have new rules limiting the number of people in a showing and requiring gloves, masks and use of hand purifiers. So find those who have already established an online presence and know how to use the technology to market themselves, and subsequently your listing, properly.
Price to Sell Using Pre-crisis Values
The coronavirus crisis is having an immediate, but temporary, impact on prices and the economy. You want to price your property to sell, but not discount its price far below what it will bring when markets return to normal. The monthly local market data that traditionally govern prices will be outdated as soon as they are released. When the crisis ends, demand will rise, and supply and demand fundamentals that created pre-crisis prices will return. It’s important to remember that while the economy may not be in the best position from previous years due to the recent outbreak and other socio-economical factors, the trends don’t directly correlate to a “housing crisis” in terms of home values.
In this environment, pricing a home to sell, but also being fair to sellers, will be very difficult. Sellers must follow local list prices of comparable properties carefully and be willing to make adjustments.
Agree to a “Coronavirus Contingency” in Your Listing
Brokers are using new contingency clauses in their contracts designed to protect buyers who don’t have a chance to tour a home or if they cannot get a professional inspection of the home. These clauses may postpone closings or even allow buyers to back out entirely from deals without penalty should the coronavirus crisis derail the process. Mentioning your willingness to agree to a coronavirus contingency clause may make your listing more attractive.
Put Together the Best Video You Can Afford
Buyers may not be attending open houses, but they are surfing listings on Homes.com. Make sure yours stand out with excellent photography and a video that shows off your home’s best features.
Anticipate a “Desktop” or “Outside” Appraisal
It will be difficult to appraise values fairly for two reasons: the temporary changes in prices mentioned above and the difficulty appraisers will have to inspect the inside of a home. The Federal Housing Finance Agency, which controls Fannie Mae and Freddie Mac, is allowing lenders to approve “desktop appraisals” based on using credit and income data and “outside” appraisals that also include a tour of the outside but not the inside of a home. After you accept an offer, put together documentation of significant improvements that the appraiser won’t know about without inspecting the interior.
Do an E-Closing
Fortunately, in recent years much progress has been made to facilitate virtual closings or “e-closings.” The most difficult hurdle has been the requirement that the documents that buyers sign at closings must be notarized. Within the last two or three years, “remote notarizations” have been legalized in about 15 states. Here is a current list.
Millions of homeowners are suffering financially due to the crisis, and many may have to sell their homes. Anyone in that situation should discuss their options with a Realtor before proceeding.