Unemployment will run deep, but it won’t be for long.

The Pain of Unemployment: It Will Be Deep, But Not for Long

The Pain of Unemployment: It Will Be Deep, But Not for Long | MyKCM

There are two crises in this country right now: a health crisis that has forced everyone into their homes and a financial crisis caused by our inability to move around as we normally would. Over 20 million people in the U.S. became instantly unemployed when it was determined that the only way to defeat this horrific virus was to shut down businesses across the nation. One second a person was gainfully employed, a switch was turned, and then the room went dark on their livelihood.

The financial pain so many families are facing right now is deep.

How deep will the pain cut?

Major institutions are forecasting unemployment rates last seen during the Great Depression. Here are a few projections:

  • Goldman Sachs – 15%
  • Merrill Lynch – 10.6%
  • Wells Fargo – 7.3%

How long will the pain last?

As horrific as those numbers are, there is some good news. The pain will be deep, but it won’t last as long as it did after previous crises. Taking the direst projection from Goldman Sachs, we can see that 15% unemployment quickly drops to 6-8% as we head into next year, continues to drop, and then returns to about 4% in 2023.

When we compare that to the length of time it took to get back to work during both the Great Recession (9 years long) and the Great Depression (12 years long), we can see how the current timetable is much more favorable.The Pain of Unemployment: It Will Be Deep, But Not for Long | MyKCM

Bottom Line

It’s devastating to think about how the financial heartache families are going through right now is adding to the uncertainty surrounding their health as well. Hopefully, we will soon have the virus contained and then we will, slowly and safely, return to work.

The Key to Selling Your Home Virtually

Keys to Selling Your House Virtually

Keys to Selling Your House Virtually | MyKCM

In a recent survey by realtor.com, people thinking about selling their homes indicated they’re generally willing to allow their agent and some potential buyers inside if done under the right conditions. They’re less comfortable, however, hosting an open house. This is understandable, given the health concerns associated with social contact these days. The question is: if you need to sell your house now, what virtual practices should you use to make sure you, your family, and potential buyers stay safe in the process?

In today’s rapidly changing market, it’s more important than ever to make sure you have a digital game plan and an effective online marketing strategy when selling your house. One of the ways your agent can help with this is to make sure your listing photos and virtual tours stand out from the crowd, truly giving buyers a detailed and thorough view of your home.

So, if you’re ready to move forward, virtual practices may help you win big when you’re ready to sell. While abiding by state and local regulations is a top priority, a real estate agent can help make your sale happen. Agents know exactly what today’s buyers need, and how to put the necessary digital steps in place. For example, according to the same survey, when asked to select what technology would be most helpful when deciding on a new home, here’s what today’s homebuyers said, in order of preference:

  • Virtual tour of the home
  • Accurate and detailed listing information
  • Detailed neighborhood information
  • High-quality listing photos
  • Agent-led video chat

After leveraging technology, if you have serious buyers who still want to see your house in person, keep in mind that according to the National Association of Realtors (NAR), there are ways to proceed safely. Here are a few of the guidelines, understanding that the top priority should always be to obey state and local restrictions first:

  • Limit in-person activity
  • Require guests to wash their hands or use an alcohol-based sanitizer
  • Remove shoes or cover with booties
  • Follow CDC guidance on social distancing and wearing face coverings

Getting comfortable with your agent – a true trusted advisor – taking these steps under the new safety standards might be your best plan. This is especially important if you’re in a position where you need to sell your house sooner rather than later.

Nate Johnson, CMO at realtor.com ® notes:

“As real estate agents and consumers seek out ways to safely complete these transactions, we believe that technology will become an even more imperative part of how we search for, buy and sell homes moving forward.”

It sounds like some of these new practices might be here to stay.

Bottom Line

In a new era of life, things are shifting quickly, and virtual strategies for sellers may be a great option. Opening your doors up to digital approaches may be game-changing when it comes to selling your house. Let’s connect so you have a trusted real estate professional to help you safely and effectively navigate through all that’s new when it comes to making your next move.

Estimated Values of Homes

armstrongfield.com provides an estimated value on all MLS listings.

If you have ever search one of the many national real estate websites you probably noticed that many times the property has not only the list price, but also an estimated value. The Zestimate provided by Zillow is probably the most well-known one. But how accurate are these “estimators”, or Automated Valuation Models (AVM as they are know in the industry)?

Let’s look at how they arrive at the values they place on homes. All AVM’s pull information from public records such as assessor’s records, which in itself, is not known for its accuracy. Some of the better ones (like the one REALTORS use call RPR) also pull data from MLS, registry of deeds and other sources. This information gets put through a proprietary algorithm that sorts and calculates the property’s value, weighing some factors more than others. These algorithms are tightly held equations that vary from each other depending on the company, and are constantly being tweaked to hopefully increase the accuracy.

How accurate are AVM’s? Zillow posted on their website that their Zestimates for the Boston area are off 5% or more of the sale price 47% of the time. They are off by more than 20% of the sale price about 10% of the time. It’s scary to think that people who are selling (or thinking about selling) their home base their asking or list price on these.

So what good are AVM’s if they are so inaccurate. Well, they offer a good starting place for someone who is performing a market valuation. REALTORS create what is called a Comparable Market Analysis (or CMA). They find similar properties that have sold and compare the subject property to them. It starts off similar to the Automated Valuation Model except they handpick the comparable properties. Next, they make adjustments for the square footage, # of baths/bedrooms, whether or not it has a pool, garage, central AC and other amenities, and the condition of the property. There are many other factors that go into the CMA – upgrades, exact location, etc. The AVM’s can’t come close to the valuation accuracy that a REALTOR can provide because the software has not seen the inside of the house, doesn’t know the condition or any number of other factors that influence market value.

So enjoy AVM’s or “Estimated Values” but don’t take them too seriously. They are a good way to watch trends in home values over the long term.

Questions? Comments?

Jim Armstrong

If you would like an accurate valuation of your home, go to:
https://www.armstrongfield.com/app/instantevaluation/template/armstrong/