We are all very well aware that the economy has taken a significant hit. As a result of the coronavirus (COVID-19), we are likely heading into a recession and its just a matter of how long it will last. History has shown us that the real estate industry is usually one of the driving forces in the economic recovery as seen in 2008. As the threat of COVID-19 global pandemic continues to grow across Canada and all levels of government enact policies to stop community spread via social isolation, millions of Canadians in the non-essential workforce are now working from and staying home. These efforts to “flatten the curve” are having a profound impact on the way many Canadians are conducting their daily lives. The real estate industry, in particular, is one that had to adapt seemingly overnight. While brokerages and real estate agents are deemed as “essential services” by the Ontario Government, there have been some critical changes to the way we must operate as face to face interaction are now a thing of the past.
Royal LePage ProAlliance Realty, was one of the first Brokerages in our area to set up Best Practice Guidelines and protocols for all viewings of properties before Ontario’s State of Emergency was implemented. We also cancelled public open houses well before the Ontario Real Estate Association & Canadian Real Estate Association (OREA & CREA) mandated it. Royal LePage ProAlliance Realty, created and has implemented, a dedicated YouTube Channel specifically for our virtual open houses to continue to promote our Client’s current and future listings.
So how has Coronavirus affected business? At this point, Coronavirus has affected business due to social distancing measures; it is not business as usual. So we have had to change our face to face business to a virtual one overnight. The real estate industry has attempted to limit all transactions that are not considered “essential.” The Ontario Government has not provided a clear definition of what is deemed to be essential for real estate; its up-to-the Brokerage to decide what is essential. I believe essential would be situations like a Seller who has an accepted offer and is now in need of housing, extreme financial hardships, Job relocations, relationship changes and the like. Real Estate is considered an essential service because housing is essential, REALTORS® are here to help you with your essential needs. We have and continue to make every effort to curb our everyday practices for the health of our clients, co-workers and families. The health and safety of our clients, co-workers and other professionals in the industry are top of mind for us. Many other REALTORS® and I are now making virtual appointments by video call, text message, telephone, video conferences and email. If you are in a situation where you need to buy or sell, please reach out, I can help guide you through this challenging time.
Before COVID-19, the biggest issue with our real estate market was that the supply couldn’t meet demand; this will likely still be the case when the state of emergency is lifted. Right into early March, we continued to see sales growth overtaking listing growth, which means conditions were getting tighter, and prices were still accelerating. In the second half of March, we saw a dip in both sales and new listings. When you look at it on a year-over-year basis, both were down by a similar amount. That means that the relationship between buyers and sellers has remained consistent. There is still a similar number of people interested in each individual listing; if that continues to be the case, prices are likely to remain relatively stable. If that is not the case and listings increase, and sales flatten or go down, buyers are going to have more negotiating power, but right now, it doesn’t make a lot of sense to be buying unless you are in a position where it is absolutely necessary.