Brighter Report: Covid-19 Edition

We all know to wash our hands, practice social distancing, and try to avoid consuming media hype like the gospel. This newsletter is not about that. 

I am not looking to build my brand on the back of a pandemic, just hoping to add value for readers whether or not they are looking to transact this year.

Let's start with some salient advice from the Wu:

Pls click for links to articles:

1. Evictions Halted:

Eviction notices may be served, but courts will not process evictions. This does not mean withhold rent, but it could mean use your rent to pay for necessities if cash flow is an issue due to functional unemployment. Again, everything is hot off of the presses, so there is no full prescription of post pandemic endgame, so proceed with caution. 

In the short term, I believe the goal is not to support actions that could lead to homelessness, and to prioritize self care over rental payments. This is not advice, this is my personal interpretation of reportage.

2. Sick Leave:

For those of you who cannot work from home, and are currently forced to choose between foregoing a paycheck or commuting to work, a bill was drafted last Saturday.

If the bill is approved by the Senate and signed by Trump, it would grant two weeks of paid sick leave at 100 percent of the person’s normal salary, up to $511 per day. It would also provide up to 12 weeks of paid family and medical leave at 67 percent of the person’s normal pay, up to $200 per day.

This does not apply to everybody, but should provide breathing room for some.

3. Working from Home with Kids.

We've opted to keep our daughter in daycare at least through the end of the week. The school is probably at 10% of normal attendance. We consulted with her teacher to see what her preference was and are comfortable with our decision. 

With that being said, what follows is not necessarily what I am currently practicing, but likely what I will be doing as of next week. 

Click links for articles.

5 tips for effectively working from home during the coronavirus outbreak, when you have kids (NBC)
 

1. Create a schedule

2. Communicate, even more than you think is necessary

3. Set boundaries with your children

4. Take breaks

5. Alternate shifts with your partner

8 Tips To Make Working From Home Work For You (NPR)

1. Get your technology in order. 
(also consider for elderly/at-risk family if you can't visit parents/grandparents)
2. Make sure you have bandwidth.
3. The kids are alright — but they're home too.
4. Manage expectations.
5. Know thyself (and thy WFH weaknesses).
6. Embrace the webcam.
7. Stay connected.
8. Do what you can; discuss when you can't.
 

Coronavirus And Parenting: What You Need To Know Now (Deep Dive from NPR)

The remainder of this newsletter will consist of real estate related advice if you are currently in the market, and some general comments gleaned from our CEO's agent directed podcast yesterday.

Wash your hands, make the best of "quarantine" time with your families, and protect your energy, while discoveries are being made and policies are being adjusted, media is still in the business of selling advertising, so fact check, whenever possible.

The market was already nearing bottom, quite possibly eroding the profits you may have envisioned when purchasing the property. Should you sell, stay put, or rent?

This depends, if you are looking to upgrade and purchase another property in the same or a similar real estate market, I would say SELL. 

Why?
The discount you could perceive as a loss, although profit is only theoretical until realized, will likely present itself as a discount on your new acquisition. If you know what you want, and/or have a talented broker helping you weigh your options, decisive action could land you a relatively good deal in a market waiting for certainty.

In short, the sooner you stop being a seller you get to become a buyer post pandemic, during a recession, at the bottom of the market.

How?
Open Houses are a great way for a realtor to get their name out there, for nosey neighbors to take a glimpse at how you live, and for early stage buyers to bolster their online knowledge with real life experiential data.

Open houses are not necessarily excellent tools for selling a home. The ultimate buyer will likely be someone who has researched, analyzed, and discussed your home as a suitable option before even requesting a 1 on 1 appointment. 

In this climate, serious buyers will likely become even more serious, and the lookie-lous are likely to stay home. 

If your property is occupied, consult with your tenant as to how they feel about appointments or open houses. Ask your tenant if digital staging is possible, and or virtual tours. 

One time agent/photographer access may become the new normal. With virtual tours putting the camera lens in prospective buyer's hands, they can control whether or not they deem the property up to snuff from the potty, or couch.

When?

I actually have a potential seller with a tenant leaving August 1. I advised to list asap, and expect no traffic until April 1. I am now revising this to April 20th, the date public schools are deemed closed until, and likely lhe next foreseeable date for a mass information upload. 

An investor should be fine with occupied property, and may not need to see how the home "feels," so long as the numbers make sense. Additionally, an investor may be willing to lob a lower offer, that while initially unpalatable, may release the seller from the property into a discounted market as a buyer.

Should we get no action from an investor or cash buyer by June 1, then I suggest we list for rent and for sale. A traditional financed buyer will need 45-60 days to obtain financing under normal circumstances, so having a signed contract by June 1 means we could close on or around August 1 limiting the sellers exposure to tenant vacancy. 

Normally summer is the busy season for rentals, but we will see how the class of 2020 fares entering the job market in a pandemic.

Timing is a case-by-case decision made relative to owner priorities and overall decision making factors for the prime pool of qualified buyers.

What?

Expect limited traffic, limited turnout and discounted offers. Adjust your expectations of profit and recalibrate with regards to your monthly carry and your next real estate move whether it is property in a similar market or out of state. 

If looking for property out of state, I would have your agent introduce you to a local broker with a strong understanding of product availability and purchasing trends, so that you are not coasting on your own impressions. Some cities will be dealing with more interstate migration than overseas investment, with a whole different list of resulting market conditions.