Everyone seems to know the 2020 Canadian real estate story so far: A promising start to the year has been put on hold due to the COVID-19 pandemic. Like many other industries, the coronavirus has led to an incredibly challenging time for the agents, brokers and developers working in real estate.
Since the country began its social distancing protocols, REW has been sharing information about what we’re seeing in the market - but we wanted to do more. Two weeks ago, we sent out a survey to real estate professionals across Canada to find out how they’ve been impacted by the coronavirus, what specific challenges they’re facing, and what strategies are being used to get through this difficult time.
In this article, we’ll go over three of the key takeaways, but don’t miss the full report and analysis. You can download a copy for yourself right here.
1. COVID-19’s Current Business Impact on Real Estate
74% of people surveyed said that COVID-19 has had a ‘significantly negative’ impact on their real estate business. On top of that, a further 24% of people said that the pandemic has had a ‘negative’ effect on their business. That means an estimated 97% of real estate professionals across the country are facing some form of hardship caused by the coronavirus.
Based on the tenor of the news over the last month, this probably feels unsurprising. Sales are down across the board, property viewings are on hold, and the initial outbreak had a noticeable dampening effect on consumer interest and property searches in general. However, it’s still worth noting that, though we all may have generally understood that the real estate community had been hit hard by COVID-19, this puts the scale of that impact into clear perspective.
No matter your experience level, client recommendations, or past success, odds are you’re in the same boat as every other real estate professional right now.
2. Key Real Estate Challenges Under COVID-19
So we’ve already established that everyone’s feeling the real estate downturn together. Now let’s look forward. When asked about the biggest challenges ahead, “new listings” and “conducting viewings” were the clear front-runners. Taken together, these two issues represent the cornerstone of what makes operating a real estate business under COVID-19 such a challenge: Fewer listings are being added to the marketplace, and for the listings that are available, it’s unclear when regular viewings will be able to take place.
Thankfully, we’ve seen an increase in the number of video and virtual tour options available in the market - including right here on REW, with more features being added all the time. Time will tell if these digital tours can help customers feel comfortable with the idea of purchasing a home, but as people grow used to this “new normal”, making sure your listings offer some form of an online-based tour will be critical to success and maintaining interest in a property.
One possible bright spot: Given how hot the market was to start 2020, the sudden decrease in new listings being added could mean that, when the pandemic ends, we’ll see a massive influx of available properties and heightened customer demand. That’s only speculation at this point, but on REW, we are starting to see daily site traffic return to pre-Coronavirus volumes.
Get the full picture on COVID-19. Download REW’s exclusive report here.
3. COVID-19’s Impact on Home Sales
Circling back to the overall negative impact of the coronavirus, we see that 39% of respondents reported losing at least one sale as a direct result of the pandemic. When asked a follow-up about a specific number of lost sales, we see a total of 404 collapsed sales.
400+ lost home sales is a large number on its own, but it’s hard to conceptualize exactly how much that translates to in terms of lost income for agents. We’re all hopeful that the market rebounds quickly once social distancing protocols are relaxed a little, but you can read more in the full report about how this lost revenue might force some agents to leave the industry altogether.
4. How are Real Estate Agents Adapting to the Coronavirus?
It’s the million-dollar question: How can a real estate agent adjust their business to cope with the socially-distanced reality of the COVID-19 pandemic? Unfortunately, there’s no silver bullet, but the survey responses on survival strategies do shed some light on how forward-thinking agents are responding to the crisis.
At the top of the list, and tying back into the previous key takeaway, are ‘Virtual and Video Tours”. This makes sense as a natural response to the limitations on property viewings and open houses currently in effect. It also reinforces the importance of making sure all listings are as digitally-enabled as possible - if you’re only sporadically using video and virtual tours, now’s the time to make it a regular part of your operations.
Sticking with the digital theme, 56% of agents surveyed also identified ‘Social Media Activity’ as a valuable strategy. If you’re looking for a cost-effective way to still promote your business and listings, getting more active on social makes a lot of sense. It’s very likely that you already have some form of social media presence, but here’s a tip - when sharing a property, make sure to include a link back to a listing detail page that allows for some form of lead capture, so potential clients/buyers can reach out to you while it’s immediately top of mind.
(Not to be too biased, but REW’s listing pages do offer a number of lead capture tools. Speak with us to learn more.)
The third most popular strategy? Cost-cutting. Over 50% of real estate professionals said they’re scaling back on at least some areas of their business, whether that’s office overhead, staff costs, or marketing spend. Lowering your outbound spend is a natural reaction to a market downturn - just be mindful that it’s important to stay ready and promote yourself somewhat ahead of the market recovery curve.
A COVID-19 Conclusion?
At REW, we believe that sharing information makes us all stronger, and we hope these three takeaways have shed a little light on how real estate professionals across the country are facing the coronavirus outbreak. Luckily, there’s even more where that came from.
Click here to get your free copy of the full COVID-19 market report now. For more information on how REW can work with your business, reach out to us anytime at 1.888.712.3607 or email [email protected].