First and foremost, we wish you and your loved ones good health, renewed positivity, and as much sanity as possible during this challenging time. Our team is here, as always, to answer your real estate questions. We are working overtime with our sales managers, attorneys, lenders, and other partners to understand the regulatory changes for landlords, tenants, and homeowners. We are also closely watching the market and seeing creative ways that real estate transactions are proceeding amidst the uncertainty and social distancing.
Mortgage Forbearance. NYS has suspended mortgage payments owed by individuals affected by the coronavirus for 90 days, tacking on those payments at the back end. Note that while these will not have a negative effect on borrower's credit score, but our lender partners have told us that the forbearance will still be visible on borrower's history on subsequent mortgage applications.
Virtual Closings. Remote notarization is now permissible making virtual closings possible. It is still the decision of the lender, seller’s attorney, buyer’s attorney, and management company whether to participate in a virtual closing.
Restrictions on showings. While residential and commercial real estate and associated professionals (inspectors, appraisers, etc.) have been classified as essential service providers, most brokerages are advising against any in-person showings or other contact. Many buildings are restricting access to real estate brokers, inspectors, appraisers, etc. at their discretion.
Move-in/move-outs. While movers/moving is considered "essential business," many buildings are restricting move-in and move-outs. While such bans are likely justified given the current health risks, some buildings have made exceptions where individuals and their movers have offered certain assurances regarding health and safety.
Sponsor Responsibility for Condo Operations. The new Executive Order postpones certain key deadlines during this state of emergency, giving sponsors more time to conduct their first closings and update their projected budget for the first year of operation. The Executive Order is effective through May 16, 2020.
At this point, the market has hit a pause. There have been about a third the amount of new inventory compared to average March numbers, and a big chunk of existing inventory has been pulled of the market. Accepted offers that were yet to go into contract, have largely hit pause or may be attempting to re-negotiate price. The only real activity right now seems to be from opportunistic buyers who are putting in deeply discounted offers. There is no data yet to see whether sellers will accept deep discounts or how this will impact prices. The sale market is braced for low levels of activity until May, or more likely June.
Compass Rental Survey results show that almost half of apartments rented since March 15 were rented sight unseen, and most rental properties were secured with little or no discount over the time period.
NYS halted all “non-essential” construction work on March 27 in light of the growing coronavirus pandemic. The order from Empire State Development has temporarily suspended a wide swath of residential and commercial construction, while allowing some work deemed necessary — like building hospitals, infrastructure projects, affordable housing and homeless shelters — to continue. According to the guidelines, non-essential construction work is still permitted to continue in certain emergency circumstances, such as continuing a project if it would be unsafe to allow it to remain undone. (POLITICO)
The true economic toll of shutting down New York City is likely to become clearer after April 1, when rent is due for the more than 60% of New York City residents who are renters. In just a month’s time, the lives of millions have been turned upside down, with countless New Yorkers now jobless and unsure when the City will be able to get back to work. While it's unclear how many renters in New York City will have a hard time paying, landlords and the real estate industry say they are bracing for as many as 40% of tenants skipping their April rent payments. (NY TIMES)
If you have any questions or want additional information or resources about recent COVID-19 guidance for landlords, tenants, home-owners, buyers, or sellers, our team is always here to discuss.