Annandale REAL ESTATE
Uncertainty in Today's Market
By: Scott Pearson, Pearson Realty
July 2020, ENDEAVOR News Magazine
The real estate market is in a strange place right now. Go to the Giant and see the people in masks, some wearing gloves and most trying to keep their distance. So what effect does the pandemic have on the real estate market? It isn’t entirely clear.
Obviously it has caused a reduction in inventory for sale as many people are reluctant to allow their house to be shown to strangers. Although extra precautions can be taken to assure greater safety during the process and virtual tours can also reduce the need for buyers to be on site at each potential property. But it is rare for a buyer to purchase a house, sight unseen, except via Facetime.
However, houses are being shown and purchases are happening as real estate firms adjust to showings by appointment only. The day of agents simply using the lockbox key without much notice or welcome is pretty well gone as long as the seller is still living in the house.
But what effect will be felt over the long run? The next effects may be the result of the high unemployment rate which could cause people to miss mortgage payments and ultimately lead to foreclosures. Since lenders usually do not use foreclosure as a remedy until the borrower has not paid for several months, we cannot judge what will happen until the fall.
An equal scenario awaits people who operate a business that simply didn’t make it due to the pandemic. Some restaurants will never reopen. The Party Store on John Marr is gone. The tour buses will not soon return to Magill’s and so that institution is no more. The fact is that for some the pandemic was a seismic occurrence that wiped out decades of operation in a heartbeat.
I add another fact. If the pandemic has robbed people of opportunities in Northern Virginia, some homeowners may decide to move either to seek employment elsewhere or speed up retirement. Let’s face it, it is expensive to live in Northern Virginia compared to most areas of the Country.
But mainly the effect of the pandemic on the real estate market is one of shock. Like a deer caught in the light, the real estate market was stunned and will take additional time to adjust to a fragile economy. Many commercial tenants have not paid their rents for a few months now. Many residential tenants have had to scramble to pay their rents and landlords are not getting much sympathy from their creditors. The question then becomes, where do the first dominoes fall?
Will it create an environment of evictions, lawsuits, foreclosures and great economic stress? Or will it be more of a tough adjustment as people and companies adapt to the “new normal” while finding equitable ways to remedy past problems? Likely it will be some mix.
Annandale is somewhat insulated from devastation due to continuous government employment and a large retirement community. However, the bill for the pandemic has not yet been paid and it will be interesting to see how it plays out in the real estate market. Which reminds me of a Chinese curse, “May you live in interesting times.” Stay safe.
Median Sales Price of Annandale Homes
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