What Homebuyers Look Like in a COVID-19 Market
It’s no secret the real estate industry finds itself in uncharted territory. Just a few short months ago the Canadian market was off to a blazing start, only to find itself now, in the wake of COVID-19, suffering double-digit home sale losses year-over-year.
But not everything has completely stopped. Houses are still being purchased in April. According to TRREB, more than 1,600 homes sales were still made in the first half of April.
“The new market reality you find yourself in, you adapt to it,” says Walter Melanson, co-founder of PropertyGuys.com. According to Melanson, who is also the company’s Lead Market Analyst and Director of Partnerships, he saw user behaviour changing even before the pandemic hit.
“If you forget that real estate has been done a certain way for 100 years, you start to ask yourself… what is the purpose of many of these aspects?”
And so, investing more in 3-D technology and high-quality video tours (think, the ability to zoom in on every corner of a house) was a natural move and one that was already beginning to happen at PropertyGuys.com. Likewise, earlier this month, real estate data firm Local Logic reported a 200-500% increase in requests for virtual home tours during the pandemic.
So what does a buyer look like in today’s market?
Well, according to Melanson, it’s simply just being in the market at all: “If you’re in the market right now, we’re considering you as a very serious buyer.” Normally, the market is plagued by a lot of non-serious buyers and noise, but all the “tire-kickers” have left, he adds.
PropertyGuys.com, like many realtors and brokerages in the industry, are finding ways to offer “no-contact” real estate during COVID-19 restrictions. “We’re designing real estate engagement that doesn’t necessitate any face-to-face,” says Melanson, including using lawyers who can close a deal over a Zoom call.
So, for buyers in the market right now, it’s not about going to visit a property, it’s about understanding the overall fit that property has with their lifestyle and their wish list. These buyers are confident in their financial situation, are perhaps a little more risk-averse, and may even take some joy in not having to compete with other buyers at the moment, adds Melanson.
“There are still lots of reasons to buy right now, including people who need to move because of work, people who have moved to the country or region recently, and people who have the money to enter the market at a time when others don’t.”
In pre-COVID times, properties were often being priced for multiple offers. That’s simply not the case right now. And some buyers will prefer this, according to Melanson, knowing they don’t have to bully there way in, and knowing that their offer will be taken seriously.
As for prices, the PropertyGuys.com co-founder says he’s found some softening but hasn’t seen any sign of the market tanking yet. Some short-term improvement in Toronto home sales helps this position, as does recent real estate showings data in Ontario.
“The market is still very much there, just the face of it has changed.”
For an in-depth look at where the real estate market currently finds itself in the time of COVID-19, including insights from Don Kottick, president and CEO of Sotheby’s International Realty Canada, Benjamin Tal, deputy chief economist at CIBC, John Pasalis, president of Realosophy Realty, and many others, you can check out our Real Estate of the Union.