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Mississippi’s home sales aided by shrinking inventory amid COVID-19 crisis

KEITH HENLEY

Many buyers eager to get deals done, brokers say

 

By TED CARTER

Home sale closings conducted in parking lots, virtual showings and carefully staged open houses have helped the state’s home sales stay steady in the early days of the coronavirus, say Realtors in north, central and south Mississippi.

The residential sector went into the new year as a seller’s market with dwindling inventories. That has not changed with covid-19 and its encroachment into Mississippi and every other state, the Realtors in Tupelo, Jackson and Hattiesburg said.

Whether sellers maintain their leverage is uncertain. But with strong demand and dwindling housing inventories, there’s some cause for confidence, they say.

KATE WARREN

“The market is favoring sellers in a lot of categories,” said Adam Watkins,  immediate-past president of the Mississippi Association of Realtors and co-broker at The All Star Team agency in Hattiesburg.

Mississippi, nonetheless, is in a market shift, Watkins said Wednesday, emphasizing it’s too early to determine either the size of the shift or its direction. “I’ve told sellers panic is not something they should be doing,” not with the markets as strong as they’ve been, he added.

In three or so weeks, Realtors will have a better idea of the supply levels and whether pricing adjustments are needed, Watkins said. But right now, pricing is holding in the Hattiesburg market, he added.

“I do think there will be some opportunities for buyers,” Watkins said. “I think we’ll see a percentage of contracts fail in next two weeks or so because of employment changes and layoffs. There could be some inventory returning to the market that was previously spoken for. This may be a good opportunity for buyers who previously didn’t have a lot to choose from.”

The concern is that continued economic uncertainty could diminish a market characterized by motivated buyers, said Keith Henley, Mississippi Association of Realtors president and broker at RE/MAX Elite in Tupelo.

ADAM WATKINS

“We’re in unchartered waters, for sure,” Henley said in an interview Wednesday, referring to real estate professionals as well as buyers and sellers.

Buyers, on one hand, are eager. But on the other are feeling some anxiety, according to Henley. “Buyers are about to embark on a financial commitment; they’re looking at it from that perspective. Sellers are looking at how this will affect the marketability of their property.”

Henley said he started last week with 14 properties ready to close. He lost two buyers, three rescheduled and the rest went through with the transactions. “Surprisingly, I am seeing business hold steady,” he noted.

The Tupelo broker said he detects that today’s buyers are like the buyers each December, typically the slowest month as holiday activities push house hunting aside. If they are hunting, they are serious in much the way a car buyer who shows up at a dealership on a rainy day is, he said.

“I think we have more serious clients we’re dealing with,” Henley said.

Early spring is the busiest time of the year for home sales. So far, Madison Realtor Kate Warren is staying busy, just not as busy as last spring.

“On the most part it is holding steady,” said Warren, president of the Central Mississippi Realtors Association and co-owner of TurnKey Properties. Central Mississippi Realtors Association is one of 21 boards associated with the Mississippi Association of Realtors.

Like Henley, house hunters Warren is working with are in a buying mode. “If someone is calling to look at a house, they are serious,” she said. “They are ready to buy something.”

Closings in a time of social distancing  require some resourcefulness. Hence, shopping center parking lots are now a venue for them, the Realtors say.

The buyers are in one car, sellers in another. The closing attorney shuttles the documents back and forth for signatures, Henley, the Tupelo broker, said.

The distancing the parking lot transaction offers helps to lower anxieties among the parties, according to Watkins, the Hattiesburg broker.

“We’re trying to be respectful of each client’s comfort level, no crowded environments,” he said.

 

 

Closing documents are being over-nighted to buyers and sellers to keep them from having to come to an office. Also, more is done electronically than ever before, according to Watkins.

With indoor closings, buyers and sellers are in separate rooms or arrive at different times. And again, the closing attorney moves back and forth with the closing documents as the process gets under way, Watkins said.

Lenders may not even come to the closing, choosing instead to let attorneys handle the work, said Warren, the TurnKey Properties Realtor.

Meanwhile, the technology investments Realtors made in recent years are providing rewards, the brokers say.

Watkins recently secured a contract on a home from a Navy couple living in Jacksonville, Fla, and planning a move to the Hattiesburg area. The couple viewed several homes through a 3-D virtual tour until they found one they wanted.  “They seemed excited and satisfied, said Watkins, who noted he has made sales via virtual tours several times over the years.

The pace of the work day seems elevated, Watkins said. He attributed this to the extra effort Realtors are making to sell while the selling is good.

“Part of this is that it’s taking more effort to do the same things now” than previously, Watkins said. He gave arranging video conference and virtual tours as an example.

The imperative in an uncertain market, Watkins said, is to follow up on every lead. This is more difficult to do when often neither a buyer nor seller wants to meet face to face.

Realtors, Tupelo’s Henley said, must seek out the business in today’s market. “It is not just going to come to you,” he said.

Open houses are still a mainstay of residential property sales. Under guidelines from the National Association of Realtors, Mississippi’s real estate professionals are limiting entry to open houses to single interested parties at a time and are more meticulous now about ensuring all parts of the dwelling are disinfected ahead of the open house.

Market surveys through February show a strong market for the 10-county Central Mississippi region, with the median price rising to $180,000 from $174,000 the previous February.

The region ended February with a 3.6-month inventory, which reflects the number of months required to sell of existing inventory at the current pace of sales. The inventory was 4.3 months at the end of February 2019, according to an overview of the Central Mississippi MLS.

“This reflects the seller’s market,” Madison’s Warren said.

Hinds County showed a 4.1-month supply compared to February 2019’s 5.5-month inventory. Madison County’s inventory dropped 12.4 percent, going from 4.4 months to 3.8 months, while Rankin County ended February with a 2.2-month supply. It ended February 2019 with a 2.7-month inventory.

 

 

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About Ted Carter