The real estate market is highly competitive right now due to factors like low interest rates, dwindling inventory, and transactions that had been put on hold because of quarantine, according to real estate agent Misty Myers.
Myers began working as a licensed real estate agent in 2014 and now manages a team of seven agents in the Inland Empire. Lately, business has spiked for Myers and her team. She explains the recent developments in the market and the day-to-day business.
Q: How has COVID-19 impacted your business?
A: When COVID hit, everything was shut down for a week. Then we were deemed essential because people have to be able to buy and sell houses. People are forced to move because of jobs and relocation. But every day it was something new. Nobody wanted to sell their house and buyers weren’t calling anymore. Everything stopped because I think nobody really knew what to do. Then there were buyers who decided that they wanted to wait because they could lose their job. Once the initial shock of everything chilled for a minute, all the buyers came back asking to look at properties. By the end of June, things slowly started to turn around and July had some pretty decent numbers. By July or August, they were saying that we were back to where we were in February in sales. There was a small blip, like a pause button, and now we’re back.
Q: How has COVID-19 impacted your day-to-day operations?
A: First they were telling us that we can’t take people out to show them property. We could go as the agent and nobody can be in the house and we just had to do video and then send that to our buyers. Later, they allowed people to be in the properties but there were restrictions on the number of people that could be in the property, and everybody has to wear masks and gloves.
Q: Are you still hosting open houses?
A: We are still not allowed to do open houses. Typically, we would have a house open for around 5 hours and it’s a free for all, people can come and go. We can’t do that. First, they told us that we can do “virtual” open houses where we walk around the house with our phones. Now we say we are having an “open house” but it’s only one family in at a time and we’re supposed to be cleaning all the surfaces between each group of people going through the house.
Q: How would you describe the current market?
A: Interest rates have been slowly dropping. Two years ago, we didn’t think we would see below 5% and then a year ago we didn’t think we would see below 4%. We can’t sustain that kind of interest rate. And we’re at like sub 3% right now. And not a lot of people are selling their houses so now we have an inventory issue. We don’t have enough houses for sale for the amount of buyers that are in the market. You have super low interest rates that everyone wants to take advantage of but there’s nothing to buy.
Q: What do you think will happen to the market in the coming months?
A: We keep waiting for the crash. The real estate market goes through a cycle. It’s usually every 7 to 10 years. The last time we went through that major crash was 2008, 2009 and we’ve been rebuilding ever since then. The market has been very good for the past few years. Knowing that it’s been 10-12 years since our last crash everybody’s on this high. There’s this anticipation of “How much longer are things going to go the way they’re going?”
Q: Do you anticipate a market crash like the one in 2008/2009?
A: They’re projecting that we won’t have as many foreclosures as we did in 2008, 2009 because nobody had any equity in their homes. The good thing is that since we’ve had such a healthy market for the past 10-12 years a lot of people are sitting on a lot of equity so there’s more options for people now.
Q: What kind of impact is the interest rate having on buyers?
A: You have a lot more people going after each individual house than you would if there were more available. People are desperate. They want to take advantage of low interest rates; we don’t know how long that’s going to last so people are going for every opportunity they can.
Q: What impact is the competitive market having on sellers?
A: The sellers are coming around because it’s incentivizing knowing the prices they could get. But where are those people going to move? There’s nothing to buy. If you’re going to rent or move in with your kids that’s different. But if you then have to buy another house it doesn’t make sense.
Q: What are your biggest takeaways from the recent events?
A: Right now, we have so much business, we’re all going crazy. We don’t know how long it’s going to last because in a second it could change. And that’s part of the real estate business. It’s never the same.