Real Estate: Are Home Sellers Complacent? Palm Off Your Property to an iBuyer NOW
A recent NAR survey shows realtors have all but shrugged off the coronavirus.
Wall Street is wasting no time discounting the economic effect from the deadly coronavirus, as seen from the very sharp cut in stock prices. It appears, however, that the real estate market is still ensconced in a cocoon of complacency, judging from the results of a recent survey by the National Association of Realtors (NAR). Home sellers may do well to dispose of their property to an iBuyer. (housingwire.com)
The images above from the survey report show that 78% of realtors said the virus had no impact on homebuyer interest in their market. There was also no change in home seller listing behavior, according to 77% of responses.
Realtors have a hand on the pulse of the market and therefore their response gives us a reliable fix on the sentiments of home buyers and sellers.
Is the rate cut blinding us to the dangers from the virus?
The real estate market was already bullish at the start of 2020 on the basis of low interest rates. These rates have been slashed further by the Fed’s weekend action. That’s supportive of the property market, but let’s not forget President Trump’s remark that it could be July/August before the situation becomes fully normal. Meanwhile, shutdowns are now pervasive throughout the economy.
Perhaps, home buyers and home sellers are underestimating the adverse impact of the virus.
But for sellers on the fence, it may be the right time to jettison that property.
An open house is a no-no
Property owners that are under pressure to sell because of career, family or life compulsions may consider the iBuyer option.
An iBuyer (read “Instant Buyer”) buys up a property via a shortcut process. All the seller has to do is to fill up a form, obtain a bid and clinch the deal. The process can wrap up in a few days. Opendoor and Zillow (NASDAQ: ZG) are the larger iBuyers.
Consider this: Can you hold an open house in these days of the coronavirus panic? Will prospective buyers even dare to come to such a gathering?
Secondly, palming off the property to an iBuyer, even considering the higher charges, might make a lot of sense in the coming months as prices start to unravel.
That could happen if large iBuyers start to offload inventory in a dash for the exits.
The bottom line for a seller: This is the peak homebuying season and interest rates have just fallen (again). The virus may have a lock on the traditional home selling process. Get a bid from an iBuyer while you still can. Close on it. Move on.
Related Story: PwC: Takeaways from the Real Estate 2020 Outlook
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