While you’re reading this, take a moment to stop and look at your surroundings. Are you in your office or a designated workspace? Are you at home? Are you out of your normal routine? As we enter months 9 and 10 of this global pandemic, it's obvious that things are not the same as they were a year ago. We have all been impacted in some way, especially in how we conduct and participate in business. Have you noticed the ways in which businesses have changed to adapt/survive in this time? Have you had to make an appointment to test drive a car? Have you seen your doctor lately for a check-up?
One of the industries that one might expect to be negatively affected is the real estate industry. We probably aren't expecting large turnouts at open houses, if they're even happening at all. But ironically, the pandemic has had an inverse effect on the real estate industry. Look around your neighborhood. Are you seeing more of your neighbors selling?
According to the National Association of Realtors (NAR), all states are seeing an tremendous increase in real estate testing. The Association of Real Estate Licensing Law Officials (ARELLO), the group comprised of state real estate licensing agencies, has also reported the same findings and recognizes that many factors are contributing to this trend. Here’s what’s interesting and why this particular industry hasn’t slowed down at all, and in fact, is probably more lucrative than it has been in a long time.
Urbanites desire bigger homesteads
Most people are currently working from home, and almost all businesses and companies are either requiring or allowing their employees to conduct business remotely (perhaps in their pajamas) via a plethora of online meeting applications like Zoom, Teams, Skype, Web Ex, etc. This allows everyone to still meet their daily responsibilities without the need to travel to and from the office. If you’re like me, working from home actually creates a longer work day, therefore increasing productivity. And many companies are benefiting from this increase in productivity and efficiency. Of course, there’s a fine line of working and then working "too much." However, in the grand scheme of things, this is a win-win situation for all.
Now, consider all of the individuals who live in smaller houses or apartments in the metro areas. Obviously, the real estate value is high and often scarce due to the proximity to larger companies. Then, factor in parking fees, transportation costs, take-out lunches, etc. By working from home, these individuals are realizing that they need more space as they and their families are now working remotely and living together under one roof. With the savings of the aforementioned costs, now they have more money to either move or upgrade. As a result, they may look for more space, maybe even a dedicated office where they can be shielded from their children, who are also studying and taking classes online. Throw in a partner and maybe even a house pet, and more room sounds amazing, doesn’t it? We’ve all seen or experienced unexpected guests walking in the background, a child that comes into the room crying, or the family dog barking at the mailman or a UPS delivery.
So, we're seeing urbanites who need bigger homesteads. People are starting to see that when they log onto their favorite MLS listing site, there is no inventory. We are experiencing a true seller's market where houses are often snatched up before the sign gets placed in the yard. With so many folks looking to upgrade, sellers are being offered at or above asking price within a few days of listing. Here’s where the real estate professional comes in to assist. Real estate salespersons/brokers/companies are doing tremendous volumes with less work than they’re accustomed to. Simply taking a few pictures and listing on the MLS is creating closed deals and offers in record time.
Because of this trend where homeowners are moving from urban to suburban living, more and more individuals are moving on to a career in real estate. PSI delivers the most real estate examinations in the United States, and we have noticed this trend of folks moving into the industry to receive their licenses. On the seller side, this decrease in supply of available homes is speeding up any thoughts of selling or retiring early, whereas housing prices are almost too good to pass up.
So, if you see another sign at one of your neighbor's homes, it might be time to contact your local real estate professional – or pursue a career in real estate!