As of this writing, most of us have been through at least a few weeks of “Shelter-in-Place” in order to help slow the spread of Covid-19. Everyone is adjusting to kids being at home (and the associated challenges of suddenly being a teacher), multiple people working from home, not being allowed to visit those in nursing homes, and for some, being out of work. Everyone is facing challenges, the reality is, we all have to do our part to help the country get through this.
In the real estate industry, there are unique challenges we are facing in the buying and selling of property. If you had been thinking of buying or selling a home, or you already had your home on the market, here are some things you should know about the changes in real estate in this Covid 19 world. Because things are changing on a daily basis, please be sure to consult with your attorney, lender and/or real estate agent for the most up-to-date information.
While initially real estate was deemed “non-essential,” Governor Baker later classified real estate as “essential” in the Commonwealth of Massachusetts. The reality is, however, it is not “business as usual.” If you are thinking of buying or selling a home at this time, here are some important things to keep in mind:
• Open houses, for obvious reasons, are not happening. Instead, agents are relying on “virtual open houses.” These are done via video, photo slideshows or virtual 3D walkthroughs. While admittedly not the same as physically being in a property, these options allow you to get an initial impression of a property; if you are still interested, you will need to reach out to a real estate agent to have an on-site visit.
• We are seeing a lot of restrictions on home showings. Do not be surprised if showings are restricted to certain days and hours…remember, most people are at home now and making their home available for showings is a bit more challenging. Also do not be surprised if agents are limiting the number of people in the house for a showing…the fewer the better, generally. And be conscious of touching things in the home. The agent may ask that you allow them to be the one to open doors, cabinets, closets, etc. Be respectful of these requests as they are meant to keep everyone safe.
• If you have an accepted offer on a property, make sure the Purchase and Sale agreement contains a “Covid 19 clause,” which will help account for delays due to lockdowns, ill parties, travel restrictions, etc…anything that could delay the closing related to events having to do with Covid 19. Please consult your attorney for more details.
• Be aware that some home inspectors have suspended inspections or are restricting the presence of buyers and sellers. Generally speaking, we encourage buyers to be present at the home inspection, but some home inspectors are not allowing anyone to follow along with the inspector…so ask questions when hiring someone.
• Fire departments are not doing smoke inspections. Pre-Covid 19, in order to close, a seller needed to obtain a certificate from the local fire department that their home was in compliance with the rules governing smoke and CO detectors. Those rules have now been changed to allow a closing to happen without the certificate. However, both buyer and seller must agree to the lack of inspection (in writing). In addition, the buyer must agree to be responsible for obtaining an inspection within 90 days of the lifting of the state of emergency and to bring the home into compliance as necessary. Generally bringing the home into compliance has been the responsibility of the seller. If you are a buyer, you may want to consult your attorney about adding a holdback to cover the cost of any potential upgrades that become necessary once the inspection is able to be completed.
• Pre-Covid 19, a good real estate agent would visit town hall and look through building, board of health and conservation files for things like open permits or other potentially relevant information pertaining to the property. With town halls closed, those activities cannot be performed. Again, if you find yourself purchasing a home, you may want to consult your attorney about adding some potential protections.
• Attorneys vary in how they are handling closings. In the past closings have generally required the presence of the buyers to sign all paperwork on site. However, in response to Covid 19, more and more jurisdictions are allowing remote online notarization (RON), which allows electronic signing of documents. Please consult your attorney if you have concerns about the closing/signing process.
As with everything related to Covid 19 and this strange new world we find ourselves in, things are changing daily. While this post is meant as an overall “heads up” on some big changes we are currently seeing in real estate, things continue to evolve. Please consult your real estate agent, attorney and lender for the latest details. If you have any questions about this post, please feel free to reach out to me (Lvandore@Landmarkne.com or 508-308-4436)…I will do my best to help answer your question or direct you where to find an answer.
Please be safe and stay home as much as you possibly can!