Virus makes real estate market feel woozy

  • A screenshot of the website Tuesday afternoon. The website listed over 900 properties for sale in the Fernandina Beach area. REALTOR.COM
    A screenshot of the website Tuesday afternoon. The website listed over 900 properties for sale in the Fernandina Beach area. REALTOR.COM

Real estate, like almost every other business, has been affected by the coronavirus.

Betsie Huben has been in real estate for 15 years, with eight of those years here in Nassau County as she worked mainly in residential property. Huben said the number of buyers in the local market has been “vastly reduced.” She added that the number of homes under contract is down 20% nationally.

Before the statewide shut down, Huben did conduct some open houses where she stayed in the garage, allowed one buyer at a time into the home, and had sanitizing wipes and hand sanitizer at the property, but after Gov. Ron DeSantis’ ‘Safer at Home’ order, those stopped in favor of virtual tours.

“There have been fewer showings since the governor shut the state down,” Huben told the News-Leader. She said she has been conducting virtual showings via the internet, where she can walk through a property using FaceTime on an iPad to show the house to potential buyers and answer questions.

“We are doing everything we normally do, such as having professional photographs of our properties,” she said.

Huben said the impact to her business has been “pretty significant” since many of her buyers do not live locally and are not traveling here to buy property.

“I’m a general residential real estate agent. I’m getting requests (and) I am listing property,” she said. “But, for me personally, that represents about 25% of my business annually, so for me to have reduced numbers of buyers stuck in other states, my business has been reduced by at least 75%.” As to the future, Huben said it is “ugly.”

“I have several clients who live in New Jersey and New York,” she explained. “If they go out of the state or area, they will be expected to go home and quarantine, and their states are not going to open up until at least May 15, so my buyer business is directly affected by not just what Gov. DeSantis does, but also but what other governors do. I need to look beyond this area to see what my business is going to look like.”

There is reason for hope.

R. Michael Morris, a real estate instructor at the University of North Florida’s Coggin College of Business and a real estate agent, said the real estate market in Northeast Florida is “currently stable,” partially due to low interest rates.

“The primary factors that contribute to this are low interest rates for buyers, and low inventory of homes to purchase,” Morris told the News-Leader in an email. “The caveat to this is the short-run impact on jobs. Most buyers currently are in the ‘this too shall pass’ mindset regarding COVID. Their perception is that we will be back to a sense of ‘normal’ in the short run, and (they) are purchasing homes accordingly (while taking advantage of historically-low interest rates).”

Morris said his business is mostly residential, although he does some commercial sales, and has not seen a dramatic decrease in sales.

“As of now, my business has not decreased,” he said. “Only a small, select group of my clients put their search on hold. The reason for this is that their purchase funds are tied to their work stocks, which took an initial hit in March.”

Short-term rentals, such as Airbnbs, are a large part of the real estate market in a tourism-centric area such as Nassau County. While that market is being affected by the coronavirus, it should rebound fairly quickly, Morris added. “Short-term rentals are currently restricted by local and state laws in an effort to keep travel at a minimum,” he explained. “While this currently hurts the hospitality and short-term rental markets, we expect these markets to see improvements once restrictions are lifted and once consumers feel comfortable traveling again.”

Huben said the actions of Warren Buffett – chairman and CEO of giant corporate holding company Berkshire Hathaway and one of the most successful, and richest, investors in the world – have given her a sense of hope.

“Warren Buffett, the so-called ‘Oracle of Omaha,’ shed all shares of his Berkshire Hathaway’s airline holdings (May 4): Delta, American Airlines, Southwest Airlines and United Airlines,” Huben said. “But, there is no indication that he is looking to shed his real estate division. That one move makes me very optimistic for real estate on both the local and national level.”

DeSantis’ stay-at-home order handed down last month gives new meaning to the importance of owning a home, Huben

“I can’t ever remember when having a home seemed more important than it did early this spring, when we were all asked to hunker down and stay ‘safer at home,’” she said. “Home ownership has always been a part of the American Dream but this year, it’s taken on a whole new level of importance. I bet that trend
continues as folks get back to work.”