North Carolina Governor, Roy Cooper, has issued an order that takes effect on March 30, 2020 at 5pm. Everyone in NC is ordered to stay at home for 30 days, except to conduct essential business. Real Estate has been designated an essential service by the Governor. So, what does that mean?
Fortunately, for buyers and sellers, the contracts that are currently pending can, hopefully, move forward to a successful closing. To keep everyone safe, new protocols are in place with attorneys offices and register of deeds offices at local courthouses. Deeds will be filed electronically, where possible or by appointment, to minimize contact. Many of the documents required to be signed will go to electronic signature format. To get to the closing however, there are many services that are required. They include appraisers, mortgage brokers, inspectors, general contractors, etc. Those are allowed to continue, as without them, the pending transactions would not be able to close. This is a time where we have to work differently and smarter as this becomes a new normal. Unfortunately, the Covid-19 crisis definitely adds some uncertainty as buyer's who are under contract may experience a job loss. For those who are getting a loan, a verification of income prior to closing could result in a termination of the transaction if the buyer no longer qualifies for the loan due to the loss of a job or other major income change.
SELLING A HOME
The North Carolina Association of Realtors and the Cape Fear Realtors Association have issued best practices to ensure that brokers, consumers and sellers remain safe. During the stay-at-home order no in-person showings or open houses will be allowed. However, with the use of video technology, FaceTime videos, virtual tours, 3-D Matterport tours, detailed floors plans, etc., it is still possible to provide consumers with a host of information on a home and to conduct virtual showings or open houses. As new listings come on line, these virtual options will become more important.
Should I List My Home Now?
This is a question that a lot of sellers have right now. The answer is - it depends? If the home is not ready to be sold because it has some deferred maintenance then the stay-at home order is a perfect time for homeowners to complete those maintenance items that they are able to do themselves. If sellers need contractors such as painters, tilers, electricians, plumbers, etc. then that will depend on the sellers' comfort level in having tradespeople in their homes. If the home is ready to sell, then the listing appointment and presentation can potentially be handled without an in-person meeting. With the easy access to FaceTime, Zoom and other virtual meeting software, listing agents are able to conduct the listing appointment virtually and the listing paperwork can be signed electronically. Photographers are also able to continue to photograph homes, but with new guidelines ensuring the safety of the photographer and owners. Best practices require the seller to have the home completely ready for photographs, with all the lights on, blinds raised, and items removed if not desired to be in the photos. The photographer should be able to go into the home and not have to touch anything, then leave. While the trusted photographer is doing their job, the owner should be a safe distance apart (preferably in a separate room, outside on the porch or in the car). This may seem like a lot of trouble to go to and, indeed, it does require a lot of different practices, but if the Seller has a short time-line in which they want to move, or if the home is in a price range that is in high demand and there are few homes on the market, then this may be a great time to sell the home.
BUYING A HOME
For the same reason that sellers need to sell, buyers need to buy. Now, since more people are staying at home, they are actively looking on the internet for the homes in the areas they are interested in. If a home does not have a virtual tour or floor plan, it may be possible to request that the listing agent do a walk-though video of the home, as if the buyer was there in person. For this kind of effort to be undertaken however, the listing agent will probably require that the buyers are ready to buy and have a pre-approval letter or proof of funds. The Covid-19 crisis has changed a lot of things in the buying process. That includes the length of time needed to close on a home. Generally, a buyer will have a due diligence period of a few weeks to find out everything they need to about a home and to obtain a loan. In normal times the due diligence period was 3 weeks or less. Now, with the high demand for mortgages due to the low interest rates it is taking longer to get a home appraised, to get a home inspected, and to get quotes for repairs, if needed. It is advisable for buyers to negotiate a minimum of 30 days for due diligence and a closing 45 to 60 days from the contract date. The NC Real Estate Commission has also issued a new addendum to the Offer to Purchase, the Covid-19 Addendum, which seeks to protect buyers and sellers in the event that they are unable to complete their obligations in the contract in a timely fashion due to the Covid-!9 crisis.
I hope this information has been helpful. It is intended to be a general overview of real estate in our local area. If you have any specific questions or concerns about real estate, please reach out to me. I can be easily reached at 910 232 1427.
Lastly, I want to acknowledge my deep gratitude to all the people who continue to work on the front-lines of this pandemic day-in, day-out, risking their own personal safety. That includes our doctors and nurses and everyone in the healthcare industry, our first responders, the truck drivers delivering food and other necessities to stock our shelves, the grocery store clerks at the cash registers, the people in the food service industry making and delivering food, and all the volunteers bringing food to those in need. I also want to give a big thank you to all the teachers who have had to navigate the virtual world of teaching very quickly to keep their students on track and work so tirelessly. To everyone, diligently working in essential businesses during this very difficult time, Thank You!
Please stay home, stay safe. We can get through this.