The COVID-19 pandemic has caused a mild fluctuation in the Savannah, Ga., area real estate market, but many people are still inking closing contracts. At the same time. local industry leaders and agents are turning to technology to help them find their forever homes.
George Myers, principal of Mia Madison Properties and president of Savannah Multi-List Corp., which monitors the real estate industry in Bryan, Chatham and Effingham counties, said the group began closely tracking data at the end of February, about two weeks prior to the pandemic being announced.
Since that time homes listed as active contingent or homes under contract have decreased about 21.5%, new listings decreased 11% and homes sold dropped by 3.4%.
Myers said even without a pandemic those numbers can be higher at any given point in a year depending on other factors such as holidays, school schedules or simply the time of year.
"In my opinion it's still a really hot market, even with everything that's going on," he said.
Myers said listing withdrawals increased 36%. But as people began to shelter in place, that wasn't unexpected.
"The reason we knew that was going to happen was because once people were sheltering in place and they were fearful of the virus, they were not going to allow individuals in to show their property and put their families at risk. I'm sure we can all understand that," he said.
"We actually expected something more like a 40% withdrawal rate increase."
While some people are taking their homes off the market, others are listing their homes and closing contracts.
In the seven-day period ending April 17, 187 new listings have been added; 59 listings have come back on the market; 24 listings have had price increases; 243 properties have gone from active to under contract; 21 homes have been listed as coming soon and 169 properties have been sold.
"What you're probably seeing and surprised to see is that the market has not necessarily wavered," Myers said.
"We've not seen anybody rushing to do major price decreases in the system, we've not seen any major withdrawal rates, we've not seen the number of new listings nor the number of homes sold waver much more than they have in the previous months.
If you do still have your home on the market, you probably don't want strangers coming in and out for showings, so real estate agents, like most other businesses, schools and government agencies, have turned to technology.
"I'm recording more informal property walk-through videos using my iPhone and providing those videos on demand for interested buyers. I'm also doing more live property tours via FaceTime," said Staci Donegan, associate broker at Seabolt Real Estate.
"Listing appointments are taking place via FaceTime and Zoom and are proving to be effective. Buyers and sellers have been extremely receptive to these new methods. There are definitely some positive things that are happening in Savannah's real estate market."
Donegan said while it depends on the seller's situation, the majority of her clients have kept their homes on the market. They have also allowed her to continue to market and show their properties with proper safety precautions in place and in accordance with the Georgia Association of Realtors' COVID-19 best practices.
"COVID-19 is impacting buyers and sellers in different ways, and that is driving their behavior," she said.
Linda Hawk of Ballast Real Estate, who serves as president of the Savannah Area Realtors, a local industry group, said she's also using new technology every day and reaching out to members frequently to make sure they're staying up to date on changes.
"We've been touching base with them weekly and sending them links and giving them some input on how to stay in this market," she said.
While closings are still taking place, many attorneys have gotten creative when it comes to inking deals, Hawk said.
"There's a number of attorneys who have gotten pretty creative with putting up canopies in their parking lots, keeping the 6-foot distance, not reusing ink pens once everything is signed and relying on Zoom to do parts of the closing online," she said.
On the lending side Myers said things are continuing to move along as usual except in cases of applicants who have been laid off or furloughed.
"Lenders are still closing those loans normally; they're still processing those loans normally," he said.
Hawk said while things are a little different, agents are still working.
"We're essential; we're still working. We may not be driving around as much, but through the virtual tours you can see just about everything you want to see with a house," she said.
Myers suspects that the situation might even make the market even stronger after the pandemic clears up.
"There's rumors that after this is said and done that there is going to be shortages of lumber because some of the lumber mills have shut down over the past few weeks, so there could be a little time before the mills catch back up for new construction," he said.
"If that happens you're going to see, in my opinion, shortages of new construction, which in turn is probably going to push prices up just a little bit after the pandemic passes."
While things have slowed on the residential new construction side of the market, things remain fairly strong, said Robert Flanders of Horizon Home Builders, who serves as president of the Home Builders Association of Greater Savannah.
"January and February were incredibly strong with the low rates and the contracts were pouring in for everybody and early March was the same way," he said.
"Since then it's definitely slowed down a little bit, but our company in the last four weeks had 14 contracts and we've lost two, so there's definitely cancellations. One of our buyers was in the tourism industry and they got laid off, but they think they'll be rehired in about a month, so hopefully they'll be back."
Flanders said he believes the area's military presence and other major employers like Gulfstream Aerospace Corp. help to bolster the market.
"For my company personally we have at least nine or 10 houses right now with Gulfstream employees," he said.
One aspect of the market that has changed since the pandemic is the decrease in spec construction, Flanders said.
"That is definitely going to affect the construction labor force, other than pre-sales, which are still trickling in, and that is going to affect framers and everyone else. They're not seeing it right now, but I think they're going to see it in the next couple of months. They're going to see a huge slowdown," he said.
"Hopefully it'll be short-lived and built back up quickly, or be able to pick up side jobs, like renovations or something like that."
Flanders noted his company usually builds one spec house for every two presold houses. He is suspending that practice for now.
"Other than the ones we're finishing now we won't be starting anymore at least for the short term," he said.
Flanders said he hasn't been affected by any lumber shortages but has run into issues with a cabinet supplier in Pennsylvania. He was able to outsource the project to another sister company.
"I've heard of a few vendor issues, but nothing that hasn't been able to be overcome," he said.
To help keep job sites safe, Flanders said Horizon is only allowing one trade in a house at a time and the HBA of Greater Savannah is continually working to reach out to members with resources, webinars and checklists.
"We're working outdoors and we try to make sure we don't go to any locations that are occupied by residents, like warranty work. We've said we're going to hold off on doing warranty work until this dies down," he said.
Flanders said while the traffic coming in is slower, the people are very motivated.
"The turnover rate from traffic to sale is a lot higher than it would normally be even though the traffic is much lower," he said.
