In the lion’s den: Real estate and COVID-19
It’s no secret that being an entrepreneur will test your will and courage. We are constantly walking the tightrope of personal and professional risk with the hope of incredible success and gain on the other side. You can’t have one without the other in our business. Today, that risk has taken on a full new meaning as we realize we are all standing in a dangerous position.
So, what do you do when you’ve stepped into the lion’s den?
A metaphor I’d like to use as we begin this journey in dealing with the spread of COVID-19 virus (Coronavirus). In the lion’s den, there are many things to be afraid of. In our current situation, one lion is COVID-19, another lion is fear, another lion is our own health, and then there’s the rest of the pack that represent the usual forces we are up against. Of course, you’re sitting in the dark, which represents the unknown. All you’re trying to do is build the house of cards that is your business, but these threats are inching closer. Their teeth are out. Their growl is loud. Man, can we get one of them a breath mint? His breath is terrible.
What do you do, when you don’t have control over your surroundings? Let’s explore.
You could be attacked by a lion (not ideal), you could freeze from fear, making it impossible for you to move forward (even more not ideal if you ask me), you could turn and run in hopes you make it out alive (really? Are you going to quit?) or, you can realize you’ve never had control this entire time. That in the cave, or out of the cave, you were at the mercy of your surroundings.
The best thing to do when you’re exposed to threats like this is to stay calm, consider a best course of action, and work slowly and diligently in that direction.
I would like you to take a deep breath.
In through the nose.
Out through the mouth.
There. Now let’s proceed calmly and with intention.
The first thing I did this week was call my tribe. If you’ve read the book, my tribe consists of strong and experienced people I surrounded myself with in the beginning. I had listings going on that day, two buyers under contract not through home inspections, listings coming on in the next few weeks, and active buyers. Oh my gawd, what should I do?
I thought you might want to hear what my tribe had to say. Here’s what I asked them, and how they answered:
What’s going to happen to our real estate market?
Coach – “Well, I don’t know Zavitz, I don’t often live through pandemics, do you? The stock market has always been volatile and should not be the reason a person buys a home (excluding pure investors) … it’s people buying homes for shelter and security for a long-term investment we are helping. It should not be a short-term decision. Historically, investing in homeownership has typically been a very safe long-term investment. We are in uncharted territory but I truly have confidence in home ownership and we should not be afraid. Like Warren Buffet says, ‘Be fearful when others are greedy and greedy when others are fearful.’”
Visionary Wendy – “I have been asking myself the same thing. This is a very difficult place to be in. I haven’t heard of any other realtors changing course outside of practicing under the health guidelines. I think we are in strange times, but I also think we have had a healthy market up until now. We should continue to keep putting buyers and sellers in places as free from risk as possible. That’s the best we can do and why it’s so important people should be using a professional Realtor. It’s times like these!”
How should we deal with new listings on the market?
Mentor Val – “It’s such a mess when things like this happen. Whenever there is an unknown in the marketplace, there is a stir in confidence. That’s just how it is. I think we continue to move forward. There is still a demand for housing here and there are still buyers. HOW ... we get them into homes will be a different story we haven’t figured out yet.”
Mentor Bill – “We are living in real time right now, so it’s hard to know. I think we continue forward but I do wonder about the number of showings and attendance at an open house. We’ll find ways around it. But I don’t know, kid, there is no crystal ball for these things so we just have to try our best and keep the client up to date.”
Visionary Chris – “If it’s about possible sick people coming through their home and a worry about their health, then yes, I think you have to pull it off the market. If it’s a worry about activity, it’s too soon to know, so I say you stay on track because there are people who need a home to buy.”
What should we do with a buyer who is under contract?
Visionary Chris – “Lay it out and let them decide. Go through each option of “what if,” tell them the impact and let them decide what is best for them and their family.”
How should we handle open houses?
Mentor Val – “That’s going to depend on you and you keeping yourself healthy. If you’re not worried about it, and it’s what the seller wants, go for it. Just make sure you’re wiping down doorknobs and light switches regularly.”
And then I called my dear friend, (practically my life coach), confidant, and lender, Tammy, who told me the following story last Wednesday.
“Shell, this is nuts. This morning I sent out a bunch of refi rates to clients. Then I went to a bunch of signing appointments and by the time I got back at lunch, rates had swung up 3/4 of a percent in a matter of hours. Let me just say, I’ve been on the phone with every single one of those folks all day. They didn’t lock in and now it has changed their purchasing power.”
::enter a terrible joke from me here that didn’t really make her laugh::
“I don’t know, I think this is how it is until the panic subsides. Whenever there is uncertainty like this in any market, there are oddities that we deal with. While it’s true we are experiencing unpredictable swings … I mean, rates are still at historic lows. Like, what did you buy your first place at?”
I thought it was somewhere around 8% for a mortgage rate.
“See what I mean? It’s still SO low. If someone bought a house up 3/4 of a percent from where we were in the morning, it’s not the end of life and the world. It just takes getting that message out there to stay calm and I really don’t know how to do that”.
We ended the conversation as we do with best wishes navigating rocky terrain.
**disclaimer - it is impossible to know what rates will be moving forward in these times of turmoil. Please consult a professional lender for guidance.
The thing I suppose my mastermind group is trying to impress on you the most right now are these six things:
Markets are never a sure thing and real estate has always been a long term, strategic investment.
It’s your client’s decision and you are the guide. Lay out the facts, the consequences, and act accordingly to their wishes.
Panic and fear HAVE ALWAYS caused uncertainty, no matter what it is.
Conduct your business with your own safety in mind. Wipe down handles, doors, and switches like you’ve just entered a bathroom at your local dive bar.
Work together. Consult your tribe about specifics in your market. This isn’t a time to go it alone.
Be the advisor in your client’s world. This week it’s imperative that you check in with your clients, both past and active. You are their resource for real estate, show up as the leader you are and connect with them. It sounds like this, “Hi, I’m just calling to check in. There’s a lot going on. Do you have any questions about the market that I can help answer?” Then listen, and listen well.
Deep breath, friends. You’re in the lion’s den. Calmly choose a course of action. This too shall pass. Leave a comment below.
Until then, chin up, keep your feet moving … and burn the white flag.
sz
Post script: The Fed’s decision to cut interest rates does not mean that Mortgage Rates are lower. Watch this video to understand it better. https://youtu.be/nRlzD53ynLs
Copyright 2020 - Shelley Zavitz Realty