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More Questions Than Answers in Real Estate

The effects of the coronavirus pandemic on the U.S. real estate market are only beginning to show, but renters, homeowners, landlords, lenders, and more need to prepare for the worst.
March 20, 2020, 6am PDT | James Brasuell | @CasualBrasuell
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First-Time Buyers

Dwight Merriam writes to get an initial read of the effects of the coronavirus pandemic on the real estate market, summarizing the initial status of the market as a widespread crisis, with few apparent responses available and numerous effects.

Expected housing pressures for renters and owners have caused banks to decrease lending. Merriam expects home values to fall as buyers leave the market, and the entire process of buying a home becomes problematic (open houses are inadvisable, for instance).

The effect has already been felt. The National Association of Realtors surveyed its members on March 9 and its Realtors  reported an 11% drop in buyer traffic and 7% lower seller traffic. The NAR predicts a 10% reduction in sales, at least in the short-term, as a consequence of the coronavirus. The NAR also issued a guide for its members about what questions they can ask of those they are dealing with as to their exposure to the virus and warning them to avoid discrimination.

The market has already reacted strongly, with REITs in mall properties and hospitality hammered. Ryman Hospitality Properties was $90.30 a share on February 18th. On Monday, March 17th, it closed at $24.09.

The remainder of the article reads like an info dump and a brainstorm, because there are many, many questions about fraud, liability, insurance, and business interruptions that simply don't have answers yet.

[The article requires an email registration, but is otherwise free to read.]

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Published on Thursday, March 19, 2020 in Connecticut Law Tribune
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