COVID-19 & Real Estate 2020

Pictured home: 1403 Wailuku Dr. Hilo, HI 96720

Naturally, listing and selling properties during this time has created extreme challenges. We’ve had several buyers cancel their buying trips. We had one seller who would not allow us in to show their home. I’m still getting showing requests from local buyers. Because interest rates decreases were so slight, they are probably not affecting buying decisions. However, local buyers have a difficult time competing, so the reduced number of off-island buyers may open a small window of opportunity. 

Home Buyers

PLEASE, do your homework first. GET PRE-APPROVED!!! Read the listings completely, check the neighborhood on your own.

At Team Nakanishi, we use a 3D system that allows you to virtually walk-thru the home and take the roof off, allowing you to look down into the living spaces. It’s a great way to preview a home like this one on Wailuku Drive.

If you wish to request an in-person viewing once you do ALL your homework, ask your agent to meet you at the property. Practice social distancing. Don’t touch things and please don’t bring the entire ‘ohana. Wear gloves. Most agents are trying to disinfect as they go but it’s not a perfect process. Be aware, some brokerages may prohibit their agents from showing. Sellers should wipe all doorknobs and leave closet and cabinet doors open. Sight unseen offers are not uncommon. 

Home Sellers

What about new listings? We have fresh inventory coming on the market, but I’m suggesting that sellers get ready to sit tight. Our stagers and photographers work alone or in pairs and none have been traveling, so we feel we can safely prep, stage, and photograph. We can release the property to “Preview” on our multiple listing service once it’s ready.

While the public can’t see preview properties, their agents look daily. Many buyers (especially off-island) are working from home and guess what they are doing? Yep, looking for their dream home. 

My recommendation not to release a new listing is really based on the perception that ticking up “days on market” is not a good thing. It’s really a seller call. Properties suited to local buyers might be the exception. 

Escrow companies and lenders are still open but either not taking in-office appointments or working by appointments only. So far, even mobile notaries are available. A new concept of a virtual notary has not been embraced locally but is being used on the mainland. While it’s early to assess the full effect, we do expect a temporary down-turn, of course. 

Market Update – East Hawai`i

I compared 2019 & 2020 numbers for the first 3 weeks in March in HPP and Hilo. Twenty-three properties sold in Hilo this year vs 10 last year. More telling is that there are 54 properties waiting to close. This is the same as last year. In HPP, 19 homes sold so far in March with 55 contingent properties vs 60 last year. There were 136 active listings in Hilo and 124 in HPP this time last year with 105 (Hilo) and 123 (HPP) this year, so things seem about the same. We have not had anyone cancel their purchase due to COVID thus far. 

Communication is Key

Current buyers should keep an eye on their rate lock. Have this discussion with your lender now. Appraisals are being affected for (especially) occupied properties. Some appraisers will not enter an occupied property. There is a push to go to a “drive-by” appraisal format. 

If you are having trouble making your mortgage payment, call the home retention number noted on your mortgage statement. I don’t know of any special mortgage forbearance provisions at this point. I do expect a temporary market shift that will impact pricing. Sellers should be prepared that buyers who are still actively looking will begin offering less, at least until things normalize. Two very useful sites are vibranthawaii.org and for tenants, NARPM.org. Stay tuned, things are changing daily!