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Major Markets in New York, California and Illinois on Pause, So Are Many Home Sales

Mansion Global // Mar 20, 2020

New York Gov. Andrew Cuomo on Friday ordered that all non-essential employees in the state stay home, in new mandates that will almost certainly stymie home sales for the foreseeable future.

“This is not life as usual, accept it,” Mr. Cuomo said, as he laid out rules that called for people to stay at home and maintain at least six feet of distance from others when venturing outside to buy groceries or exercise. The order applies to all but essential businesses, such as health care and supermarkets.

“Grocery stores need food, pharmacies need drugs, your internet has to continue to work, the water has to turn on,” Mr. Cuomo said, adding that it was the most drastic action the state could take in response to the rapid spread of Covid-19, the novel coronavirus.

New York joined California as well as counties in Washington State and Colorado in ordering residents to stay home for the most part. The governor of Illinois also announced a “shelter-in-place” order on Friday.

The new rules have been in effect in California and will go into effect on Saturday in Illinois and on Sunday in New York. These are the latest in a crescendo of measures, which have included c losing the Chicago and New York City’s public school systems—the latter being the largest in the country.

New York state has in just the last few days become the latest epicenter of the virus’s spread in the U.S. By Friday afternoon, total cases approached 8,000, roughly 10 times what they were at the start of the week, figures that partly reflect a vast expansion in testing.

Across the country, many in the real estate industry moved quickly in the past week to accommodate social distancing, offering hand sanitizer and booties at home tours and uploading virtual walkthroughs to online listings.

Bright MLS, which covers much of the U.S. Mid-Atlantic, including Washington, D.C., announced a webinar series for agents on best practices during the outbreak. One of the top luxury agents in Las Vegas said his agency would show homes on FaceTime and Zoom.

But sweeping orders for people to stay home in California and New York will put off many buyers, for whom a house purchase is often their biggest investment, said Danielle Hale, chief economist at realtor.com.

“You find homes through platforms like realtor.com and you can narrow your search down, but once you get to the point of making an offer, you’ll have many people wanting to see the place,” Ms. Hale said.

Such rules will presumably limit the ability of experts to make home appraisals, which many banks require in order to grant a loan to the buyer, Ms. Hale added.

Shaun Osher, founder and CEO at New York City-based CORE Real Estate, said deals can still happen in this climate, especially for new developments, where agents are accustomed to courting buyers using floor plans and mockups long before construction on a project is complete.

“All you really need is a buyer and a seller to have a meeting of the minds on price, and then you need a real estate attorney. Almost everything can happen remotely,” Mr. Osher said.

Though for many in resales, selling a home that’s more or less sight unseen will be uncharted waters, he said.

“Now more than ever before, there needs to be heightened seriousness about the representations we make,” he said.

Andrew Barrocas, CEO of New York-based agency MNS, said he agrees with his governor’s decision despite the economic repercussions.

“There’s no other solution right now that makes more sense than doing this,” he said, adding that buyer interest has persisted despite the uncertainty. “My hope is that in 30 days we’re back to some normalcy.”

Original Article: Mansion Global