May 2020 – What COVID-19 Means for the Housing Market

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COVID 19 Update

RMA wishes all our owners safe sequestering!

Remember to exercise caution as our state gradually reopens.

For the latest COVID-19 protocol in the State of Idaho, please visit: https://coronavirus.idaho.gov

What COVID-19 Means for the Housing Market

By Athena Savoglou

Unprecedented times by definition give way to mounds of uncertainty.  For real estate owners, investors, or prospective investors, one of the most prominent questions amid a crisis is how the real estate market will be impacted.  Amid the COVID-19 pandemic, you have no doubt asked yourself how your investment will fare.  What’s the outlook for the value of your property?

Housing Market on “Pause”

Given that we do not have a crystal ball, many reports point to the fact that the national market is on “pause.”  In other words, few people are selling, and few people are buying.  This could be due to economic uncertainty, or simply that people are supposed to stay home all the time – or a little bit of both.  The bad news here, is that this is probably not the time in which you will win big on a new investment, nor the time your existing investment will rake in the dough.  But the good news is, most analysts are predicting that things will get back to normal pretty quickly once the virus dissipates and stay-at-home orders are lifted.

Before the pandemic, demand was high, and supply was low.  Now, demand is still there, but it is not “active” right now – hence the “pause” terminology.  Those looking for real estate (whether to rent as a tenant or buy as an owner) have temporarily stopped looking.  Similarly, most looking to sell have temporarily stopped actively advertising.  So even though this is less than ideal, the balance between supply and demand is there, and the market is not being thrown off – It is just on a break, all around. 

On a local level, we are getting mixed feed-back from our realtor network.  Some are definitely experiencing the pause effect, while others report being busier than ever!  When asked why they think they have an increase in activity, they speculate that it may be all about perception.  Buyers perceive they have an opportunity to take advantage of falling prices, and sellers are concerned that prices may drop in the coming months and want to get ahead of any potential decline in prices.

Note on Housing Prices

Ralph McLaughlin, chief economic for Haus, says the worst case is that housing prices will fall 1-2.5% in West Coast markets.  All things considered, that is not terribly drastic.  The factor in flux is amount of transactions happening, not the prices themselves.  Once stay-at-home orders are lifted and some normalcy returns to society, prices will look about the same, and home sales will likely return to near-pre-pandemic levels.

Note on Local Rental Rates

Our new lease ups have been strong over the past month.  The only properties that seem to be suffering are those that are in the price range typically attractive to the very workers who are currently out of a job.  Service workers in the hospitality and retail industries, and any hands-on professions in the beauty and wellness industries such as hair stylists, massage therapists, physical fitness trainers etc.  When you don’t have an income, it’s impossible to qualify for a rental. May will be a significant month in defining what our short-term outlook might be.  If the State of Idaho doesn’t get unemployment benefits out to our displaced workers very soon, it could start a chain reaction of hardship, the outcome of which is very difficult to predict.

In conclusion, sit tight.  We know this is hard on everyone, but it is important to keep perspective. This will pass, and one way, or another we’ll get through it!

Read more at:
https://www.curbed.com/2020/4/23/21231093/housing-market-recovery-coronavirus-covid

Sprinkler Turn-on Progress 

Our vendors are in the process of getting to all our rentals to activate the sprinkler systems.  Many of the city water serviced households are already operating.  Properties on the canal system may take a little longer to turn on as canals are filled gradually over time and then need to allow a period for sediment to settle before irrigation systems can be activated. All properties will be turned on before the end of May.

Our weather has been warmer and dryer than normal, so tenants have been instructed to utilize manual watering techniques until their automated system is operational.

Maintenance Updates

Due to COVID-19, maintenance items are being rescheduled.  Anything that requires interior maintenance will be postponed until we get the all-clear to do so. Anything on the exterior that is seasonally appropriate will remain on schedule.

Maintenance Schedule for May

– The Lawn care list will go out the beginning of May to be completed after all sprinklers are up and running.

– The lists for the landscape clean-ups and the gutter cleanings went out in April and are expected to be completed the beginning of May.

The maintenance updates only apply to those of you who have pre-ordered these preventative maintenance services. If you didn’t opt in for a service you read about in this newsletter, and would like to schedule a service, just email MacKenzie at maintenance@rentalsinboise.com to let her know.)

Other questions?  Please email MacKenzie.  maintenance@rentalsinboise.com or call: 208-514-4864

Accounting Updates

There are no special accounting items in April.

If you ever have questions about your statement, please contact your property managers:

Spencer Henderson, spencer@rentalsinboise.com

DaNay Salas, denay@rentalsinboise.com

If you have trouble logging into your client portal, please contact your property managers or Brandy Kerr at RMAinfo@rentalsinboise.com.

Tenant Update

This month’s tenant newsletter also reminds our tenants about the important of yard maintenance as the weather gets warmer.

This month, we feature a crossword puzzle, the clues for which are hidden in our Reminders sections as well as the feature article.

Check out our tenant newsletter this month: https://www.rentalsinboise.com/property-management-blog/april-newsletter/