What Is the Long Term Impact of Coronavirus on NYC Real Estate?

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What is the long-term impact of coronavirus on New York City real estate? We will demystify this topic in the following video. I'm Nick at Hauseit, visit our website https://www.hauseit.com to learn about ways to save money when buying or selling real estate here in New York City, so let's get started.

The Coronavirus pandemic will likely have several long-term effects on the residential real estate market such as accelerated adoption of 3D virtual tours and a new wave of permanent rules and restrictions on open houses implemented by condo and co-op buildings in the city. There will likely be many others short and medium-term effects such as greater required financial vetting of buyers before scheduling showings, more restrictive access for tenant occupied properties, capacity control for open houses as well as reduced demand for investment properties and second homes, growth of 3D virtual tours and property videos. Even after social distancing runs its course, the Coronavirus pandemic will likely accelerate the adoption of 3D virtual tours and property videos by listing agents here in the city. In fact, many platforms such as StreetEasy rapidly added 3D virtual tour capabilities to their listing interface within a matter of weeks after the pandemic’s arrival.

Over the long term, we anticipate that many brokerages and listing agents will embrace both 3D virtual tour and property videos and incorporate this as part of their listing agent service offering. Sellers will likely also demand this technology from their listing agents and sellers will likely place a greater emphasis on the accessibility of this technology when determining who to hire as a listing broker.

More building open house rules and restrictions. We anticipate that over the long term, many condo and co-op buildings will adopt additional rules and restrictions specific to open houses and private showings. Many larger condo and co-op buildings in New York City already had strict rules regarding open houses and guests prior to the pandemic.

Many buildings prohibit open houses altogether while others have policies requiring two agents and or policies requiring all guests to be escorted at all times. We've always felt that such rules are incredibly harmful to a seller's marketing efforts and ironically these same rules which are presumably intended to improve the safety and quality of life of owners actually reduce property values in these buildings by making it harder to show the apartments.

That being said, the pandemic will likely catalyze rapid rule changes in many New York City apartment buildings, which despite the long-term harm they may cause to property values, will likely not go away for years if ever. More reasonable buildings might not necessarily ban open houses in the wake of corona virus but they may limit the number of open houses permitted on any given day or increase the notice period required for listing agents to request permission from management.

The bottom line is that many buildings will increase the red tape when it comes to selling and this will harm sellers and create more work for listing agents going forward. Greater financial vetting of buyers before showings. Over the long term, our experience with the Coronavirus pandemic will likely result in a push by sellers and listing agents for greater financial vetting and scrutiny of buyers as a condition of scheduling private showings. The days when buyers and buyer agents could simply request a showing without providing any background or financial insight are likely gone for good.

Sellers and tenants will likely be much more restrictive and cautious when it comes to allowing strangers into their homes, and we believe that private showings will likely only be considered if a buyer has already viewed the 3D virtual tour, shared their financial qualifications, discuss the listing at length with the listing agent and expressed a serious desire to possibly submit an offer subject to an in-person viewing.

Capacity control for open houses. In the wake of Coronavirus, we anticipate that regulatory bodies and real estate trade groups will likely issue guidance regarding capacity control at open houses. It wouldn't surprise us if the packed open houses with 50 to 75 attendees for the one-bedroom apartment type property in Park Slope for example are a thing of the past.

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