After The Fall
It’s not what we wanted to hear – Shelter in Place (SiP) is extended. We’re getting there, but the curve hasn’t flattened enough to resume life as we knew it. In the current impasse, here’s a quick summary of the state of real estate in Santa Cruz:
Restrictions limiting the preparation of homes are in place. Open houses are cancelled. Strict safety protocols for showings remain. The mortgage industry continues to struggle with forbearance. And most things real have become virtual by necessity.
One would assume real estate sales simply stopped the day the SiP orders were announced but a surprising number of transactions have actually closed over the last six weeks (most going into contract before 3/17) and quite a few homes are in escrow at the moment – albeit in lower price ranges.
It’s cause for optimism but also way too early to hazard a guess about how the market will rebound. Until the SiP is lifted and every would-be buyer and seller is free to re-enter the marketplace, we’re not going to get a true read on the actual recovery that lies ahead.
In the meantime, it’s hard not to jump ahead and try to figure out how this will resolve itself. Here are some of the bigger questions I’ve been considering lately: How will people’s lives change from their experience of the coronavirus? Will more folks reimagine their futures and start making new choices about where to live and what kind of homes they want? Shifts happen and here are some we’re likely to notice in the months ahead:
Where you live may not be as important as it was. The utility of virtual workspace has expanded and after three months without traffic, people won’t be anxious to get back in their cars. Commute times may not be such a pivotal factor in home purchases.
People may retire sooner than planned and downsizers may accelerate their timelines to move-down after catching a glimpse of a future without access to the substantial equity in their homes and comfortable nest eggs of security.
The trend towards smaller homes may reverse itself now that people have experienced very real needs for: private workspace at home, room to exercise or meditate and greater separation from kid-related activities.
The trend towards denser urban settings may shift back towards rural locations that offer more land and privacy. Or to older more established communities that offer larger yards and more built-in social distance from neighbors.
The trend towards multi-generational living may increase as families recognize the need to be closer and perceptions around assisted living communities plummet. Reverse mortgage applications may also increase.