Usually during a normal spring, 40 to 50 homes come to market weekly in Pasadena, while this spring is averaging around 10 per week. For the market in Bungalow Heaven, 10 homes were sold in the first quarter of 2019, while 8 homes entered into contract or were sold during the same period in 2020.

The Shelter in Home order initially slowed the market while all the real state industry was figuring out new processes to operate virtually, in order to keep clients safe. However the past three weeks the circumstances have been changing and the market is picking up again. There are many cases of transactions with multiple offers during the first week in the market slightly exceeding the asking price. There are many buyers still looking for homes true to their architectural style, in good condition and in a desirable location. Forecasts by multiple experts suggest sellers will do better now than in two months, when the inventory is expected to rise due to the loosening of shelter in place orders and continued increase in unemployment affecting a larger share of potential buyers. The number of homeowners who have sought mortgage forbearance reached 7.91% as of May 3.

Though the risk of growth in unemployment looms, the buyers that were ready to buy and haven’t lost their jobs are seeing this as an opportunity to buy, so they are very serious but cautious. As such, the pricing strategy needs to start close to fair market value in order to avoid driving away serious buyers, which would occur with a high starting price, or putting ourselves in a position of negotiating a price that doesn’t maximize your income because we started with a lower price. Starting with a low price is a strategy that works in different market conditions to try and generate a bidding war and increase the price, however the current market is not optimal for that strategy.

Physical open houses are still not allowed, but we have developed a virtual open house approach that has shown to be effective, as it is being well received by buyers. Using the technology widely available we are able to schedule and conduct virtual open houses, either open to the public or restricted to the realtor’s community and clients. We have created 3D home tours, allowing people to see and assess the property as many times as they want. The number of 3D home tours have jumped 188% month over month according to Zillow research. Now is critical to have virtual home tours since these homes receive 50% more site visitors. The people that are interested will subscribe to the virtual open house, and while showing the house I can answer any questions they have. If they are very interested after attending the virtual open house, a private showing can be scheduled. The prospective buyer must sign a “property entry advisory and declaration document” agreeing to practice social distancing and taking all the steps necessary to protect themselves and others. Only one potential buyer can be in the house with the realtor at a time. The realtor has the responsibility to clean and disinfect all surfaces before and after the touchless showing.

Please let me know if you have any questions or comments. I would be happy to have a phone call, or even a socially distanced meeting (with appropriate masks) to help answer your questions and to view your house in order to provide a general idea of what the market may pay for your house at this time. We could also discuss different pricing strategies and steps needed to prepare to list the house.