The Spring Regional Housing Market Report just released by the Center for Housing Solutions & Community Initiatives notes that sales volume is down across the region due to restrictions imposed by New York State to prevent the spread of the Novel Coronavirus.
While the Mid-Hudson has entered phase one of its economy’s reopening, the real estate industry is still subject to restrictions that make almost all of the transaction virtual. Those restrictions will be lifted, however, when the Mid-Hudson enters phase 2 of the reopening, which is expected in June.
The report, published by the affiliate of Newburgh-based Hudson Valley Pattern for Progress notes that current guidelines allow Realtors to offer virtual home tours if the sellers will allow access, but Realtors may not meet with buyers or sellers in person, which has put downward pressure on sales activity.
The International Association of Certified Home Inspectors acted quickly to offer a five-hour COVID-19 Safety Certification so that home inspectors could understand and minimize the risks of COVID-19 while continuing to complete home inspections during the “New York On Pause.” Home inspections are now generally conducted without buyers present and then wrapped up virtually via video so that the Home inspector can convey the summary of findings.
Key segments of the real estate transaction—contracts and closings— are also impacted by the COVID-19 regulations. Due to social distancing requirements, closings have been challenging for attorneys, title companies, Realtors, lenders, and buyers and sellers. New York State has allowed Virtual Notary Services and many attorneys are conducting their contract reviews by phone or video chat, the report states. For closings, attorneys and lenders have devised ways to minimize contact between parties, including pre-signing documents, offering staggered schedules for signing parties and even drive-thru closings.
The Center for Housing Solutions & Community Initiatives concluded its report, saying, “There are uncertain times ahead for the real estate market. The sales volume is likely to continue to decline and prices may be stagnant in the short term. However, interest rates are extraordinarily low, many buyers are still working, and the Hudson Valley is likely to see market pressure from the New York City metropolitan area. The ability to work from home will also play a part in the demand for housing in the Hudson Valley.”
Recently, executives from residential brokerage firm Better Homes and Gardens Rand Realty and affiliate Rand Commercial, were featured on webinars hosted by the Hudson Valley Economic Development Corp. and Hudson Valley Pattern for Progress, according to a Real Estate In-Depth report.
Executives with both firms said that business was continuing during the health crisis caused by the Novel Coronavirus and that the social and economic impacts, while severe, will not cause a crash in the residential or commercial real estate markets in the Hudson Valley.
On April 30, Matt Rand, CEO of Better Homes and Gardens Rand Realty and Paul Adler, chief strategy officer with Rand Commercial, participated in a “Back to Business” webinar presented by the Hudson Valley Economic Development Corp. During the session moderated by HVEDC Chief Executive Officer Mike Oates, Rand discussed the state of the current residential and commercial markets and his views on how the market will respond once the pandemic’s impacts have been minimized and the economy is fully-restarted.
Rand said that his brokerage firm continues to conduct business and has benefitted from its agents and others in the transaction process employing creative means to shepherd sales transactions in the pipeline during January and February—prior to the state going on “pause” on March 22— to closing.
He noted that the market was really strong in the first quarter and added “We don’t think there is going to be a real estate market crash even with unemployment being at high levels, even with mortgage standards being a little tighter, there is still incredible demand both on the commercial and residential sides.”
Adler said that the “new normal” is now and that the commercial real estate market will have to adapt to the increased use of technology, remote office usage, as well as continued changes in the retail sector.
He said that commercial brokers are already seeing an increased interest from New York City-based companies looking to possibly set up operations in the Northern suburbs and that the region should market its many assets, including its health care network, infrastructure and New York Stewart International Airport.
On May 1, Pattern for Progress hosted a webinar entitled “Housing Update: COVID-19 Impacts on the Real Estate Markets.” Moderated by Joe Czajka of Pattern for Progress and the Center for Housing Solutions, the program featured a panel that included: Matt Rand, Joseph Rand, COO, Better Homes and Gardens Rand Realty; Bill Calderara, president and CEO, Ulster Savings Bank; William O’Keeffe, attorney, O’Keeffe & McCann, LLP; Gregory Langer, president, Valuation Consultants and Darren Scott, upstate director of development, New York State Homes & Community Renewal.
Joseph Rand estimated that closings for the month of April 2020 would be 60% of what the Hudson Valley region registered a year earlier. He added that he expected closings in May would slide to 40% of those finalized in May 2019.
He noted that job and investment portfolio losses will definitely impact buyer demand, but also agreed with other panelists that market activity will by no means fall off a cliff.
“I think the buyer demand will come back,” Joe Rand said. “What we have seen so far is that pricing has held up. Sellers are not selling at a discount to get into contract even now in the midst of the pandemic.”
He concluded that residential sales volume will improve in the third and fourth quarters of this year. “I think the housing market has a decent chance of coming back as long as the economy isn’t completely discombobulated,” Joseph Rand predicted.
Pattern for Progress recently hosted a very informative video presentation entitled Healthcare—The COVID Frontline that featured moderator Jonathan Drapkin, president & CEO, Pattern for Progress along with Dr. Hal Teitelbaum, M.D., J.D. - founder, managing partner & CEO, Crystal Run Healthcare; Joan Cusack-McGuirk, president & CEO, Montefiore St. Luke's Cornwall and Linda S. Muller, president & CEO, Cornerstone Family Healthcare. To view the presentation, go to: https://www.youtube.com/watch?v=kHp7dZryeHY
