NAR Survey: 9 of 10 Realtors Say Market Is Recovering
WASHINGTON – A new survey from the National Association of Realtors® (NAR) finds that nine out of 10 Realtor members believe their market is recovering from the pandemic shutdown as economies start to reopen.
NAR’s 2020 Market Recovery Survey polled agents about their residential and commercial real estate markets and found that 92% said a portion of their buyers have either returned (9%) or never left the market (18%). Realtors in small towns and rural areas were more likely to report no pause in buyer activity, and they were also more likely to report a stronger return of buyers to the market.
“The residential market has seen a swift rebound of activity as numerous states have begun to ease mandatory stay-at-home orders,” says Lawrence Yun, NAR’s chief economist. He says many buyers and sellers paused in the early stages of the pandemic, but “Realtors nationwide were able to quickly pivot, embracing technology and business practices to ensure the home buying process continued in a safe manner.”
Most Realtors (89%) said they had sellers who either returned to the market or never delisted their property, with 24% saying their sellers never left. However, suburban and urban markets saw fewer sellers returned to the market.
Two-thirds said that sellers’ timelines to sell haven’t changed, while 23% said they have sellers who feel more urgency to sell.
Of those Realtors working with buyers, 54% said their timelines to purchase a home haven’t changed, though 27% said they see even more urgency today.
Yun says many buyers’ plans were stalled during the pandemic, and “that has led to more urgency and a pent-up demand to buy” now. “After being home for months on end – in a home they already wanted to leave – buyers are reminded how much their current home may lack certain desired features or amenities.”
In some cases, respondents reported changes in buyers’ preferences: 24% of Realtors have buyers who shifted their preferred location due to the coronavirus. Among those Realtors, 47% said they now preferred a house in the suburbs, 39% cited rural areas, and 25% said smaller towns.
Some buyers changed the features they want in their ideal home, according to 35% of surveyed Realtors. The most common changes are a desire for a home office, space to accommodate more family members – older adult relatives, newborns or pets – larger homes with more personal space and bigger yards suitable for a garden.
More than one in 10 buyers (13%) want a bigger home, changing their search to accommodate that desire. The shift is highest in urban markets at 16%. In addition:
- 33% have adjusted their commuting needs, with 22% less concerned about their commute
- 7% want to live close to bike trails that connect them to work
- 5% have a greater concern about parking and more concern for a location that allows them to drive to work
Some commercial Realtors said they’re contending with hardships. Only 19% of property managers received all rent payments on time, and only 36% of individual landlords have received rent on time.
Three out of four commercial members said some leases were terminated or tenants asked to delay rental payments, with the greatest share (56%) in non-essential retail establishments, followed by the office sector (38%). However, grocery stores are faring well, the least cited of the commercial properties at 4%.
“Consumers have been forced to move away from buying in stores and are now doing much more shopping from home,” says Yun. “Unfortunately, this has come at the detriment of commercial property owners.”
But Yun also sees the change as an opportunity in the industrial warehouse market with Americans relying more on home delivery services. As economies reopen, 44% of NAR members expect demand for industrial properties to increase, and 35% expect the demand for multi-family properties to increase. On the other hand, 72% expect demand for non-essential retail to decline and 66% expect office usage to decrease.
The biggest concern for small businesses, according to 83% of commercial members, is a lack of profitability due to a decrease in customers. A majority of Realtors also expressed concern with:
66%: A resurgence of the outbreak forcing another shutdown
61%: Protecting the health of employees
59%: Challenges implementing social-distancing measures
While the pandemic caught the housing market off-guard, the NAR survey found that many members are now prepared if another surge occurs: 39% are somewhat prepared for a second wave, and 19% reporting they are “very prepared.”
Of those Realtors who think there might be a resurgence, 30% said they’re more prepared now because they know what to expect, and 27% have changed business practices in some way to prepare for another bout of the virus.
© 2020 Florida Realtors®