Although real estate was deemed an essential business and realtors were not required to shut down, there were restrictions due to the threat of COVID-19 and, since the economy began to restart, the industry of buying, selling and renting has undergone some significant changes.
“There's less tours happening, which is good, but also extra compliance burdens,” said Jonah Schwartz, a California resident who co-owns more than 80 rental units in the state. “Agents are having to collect the right forms, disclosures and ensure applicants are qualified before they view properties so as to eliminate as much in-person contact as possible.”
The sale of homes decreased by 5.4 percent statewide in April, according to the California Association of Realtors but as soon as the economy began to restart, rentals and sales began to pick up immediately, according to Schwartz.
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“Our property manager has started encouraging tenants to pay online because it's a safer way to collect rent rather than in person and all of the leasing workflows, like submitting an application or signing a lease, are moving online as well,” Schwartz told the Southern California Record.
Agents had been banned from showing occupied units due to COVID-19 shutdown orders but now that the state has started the process of restarting the economy, new guidelines have been issued. As of June 6, schools, gyms and bars are permitted to re-open as the state moves into Phase 3 of its Resilience Roadmap, according to media reports.
“Agents can now show occupied units but without residents present,” Schwartz said in an interview. “You have to wear PPE, sign a disclosure that you understand the risk of COVID-19 and show that you are pre-qualified to purchase or rent with a letter from the bank or show somehow that you have the funds. It’s a lot stricter not like before COVID-19 where you could wander into open houses.”
One permanent COVID-19 change that Schwartz has noticed is the democratization of the virtual 3-D tour of units or homes that are for sale or rent.
“When virtual 3-D tours first started, it was for high-end homes but after COVID-19 now even a small apartment renting for $800 a month will have a virtual 3-D tour,” Schwartz said. "Having a virtual tour is great because they see the layout of a unit before they move in, apply or pay a fee to apply.”
As of June 8, there were 128,812 coronavirus cases statewide and 4,626 fatalities, according to the Department of Health.
“During the lockdown for the applicant’s protection and the protection of our property managers from COVID-19, we required potential tenants to be pre-approved before they could see even a vacant unit that they were planning to rent,” said Schwartz.
COVID is also accelerating technology options across all of real estate, including commercial and residential. In addition to owning rental units, Schwartz co-founded a software company called Stessa to help other landlords and investors manage and track their properties as well as rental property finances quickly and easily.
“Clients who used Stessa for bookkeeping are now realizing they need their financial records managed or they want to start collecting rent digitally so we’re helping them with that,” Schwartz said. “We're solving the problem of increased paperwork, workflow and keeping track of everything electronically for our customers.”