How are consumers buying and selling homes in the time of COVID-19 and social distancing?

Because real estate agents and mortgage lenders provide what are considered essential services, they have been allowed to continue doing business amid the coronavirus pandemic. However, with the virus’ spread and concern for increased cases of COVID-19, the respiratory infection caused by the coronavirus, real estate and mortgage professionals have had to make a few adjustments in how they work with home buyers and sellers. 

Virtual Showings

Real estate agents across the country, and around the world, are being encouraged to practice social distancing while conducting business. That means staying at least six feet apart from other people who are not members of their household. In fact, whenever possible, agents are encouraged to take advantage of today’s technological resources and conduct virtual showings. This can include creating a virtual, interactive tour online, or simply using a mobile device to stream a live video walk-through of the home in question.

Safety Precautions During Physical Showings

For many home buyers, virtual showings just aren’t enough. While some are willing to purchase a home sight unseen (in 2018, Redfin reported 35% of buyers made offers without seeing the home in person), most people want to see the home in person at least once before they make an offer. But in the age of COVID-19, in-person showings look a little different than they did six months ago.

Today, physical showings are typically done with social distancing and cleanliness in mind. This usually means showings are limited to a small number of people at a time (or staggered showings with 1 person or family being given a tour at a time), having all parties stand at least six feet apart during showings, making reservations for showings rather than hosting an open house, and frequent disinfecting of high-tough surface areas.

Buyers may also be asked to wear masks, use hand sanitizer upon entering the home, wearing disposable shoe covers, and driving separately from the real estate agent to the showing.

Electronic Signatures

Even before the COVID-19 pandemic, electronic signatures were widely used by mortgage and real estate professionals. Now their efficiency and efficacy are all the more beneficial, as people are doing their best to avoid sharing and handling paper documents, pens, etc. Not to mention, an electronic signature does not require being present at an office or public building. This allows people who are socially distancing or even self-isolating to complete and sign important real estate and mortgage documents. There are even a growing number of “contactless mortgages,” which utilize a wide range of modern communication technology to complete a major financial transaction. These usually involve video meetings instead of face-to-face meetings, electronic documents and signatures, and even virtual appraisals.

Coronavirus Clauses

Yes, this is a thing now.

Mortgage lenders understand that the coronavirus can cause a lot of uncertainty when it comes to day-to-day life, let alone making a huge financial decision. The idea behind these clauses is to protect buyers or sellers from COVID-19-related conditions beyond their control, such as delayed appraisals or inspections, or instances where closing must be delayed due to a buyer or seller testing positive for COVID-19.

If any of those or other corona-related issues come up, these coronavirus clauses can extend a closing date, usually up to 30 days. If you’re considering buying a home during this time, ask your real estate agent and/or mortgage lender about adding a coronavirus clause if there isn’t one in place already.

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