To bring potential buyers into a property, agents must show that no virtual options are available. (Courtesy photo)

Realtors can show houses again? Not so fast

As shelter-in-place rules loosen, confusion increases in San Francisco real estate market

Just when it seemed like real estate was dead(ish), along comes a slightly relaxed version of shelter-in-place that allows for heavily restricted in-person home tours, freeing us from a dystopian future of virtual tours, virtual open houses and helpless agents watching from home as sellers, armed with iPads, display the virtues and warts of their homes to captive Zoom audiences.

As of May 4, California rules changed to allow a single agent, accompanied by no more than two clients, into occupied for-sale properties — as long as the occupants are not present. As the first step on its long trip back to normalcy, home shopping will resemble shopping for Cokes at a 7-Eleven. “Only two customers in the store at a time, please. Social Distancing.”

Good news, right? Not so fast. While the California Association of Realtors has indeed established these new guidelines, the story in San Francisco and the greater Bay Area is somewhat different. Much like our overall shelter-in-place rules are dictated by our mayor and not by Gov. Newsom, local real estate rules are also local. And they have been relaxed… somewhat. Have they been tweaked enough to bring relief to an industry that saw a decline of approximately 80 percent of its business? (That’s how much the number of accepted offers fell by in April.)

It doesn’t seem so, and here’s why:

The catch, per guidelines released by the San Francisco Association of Realtors and echoed by their peers down in San Mateo, is that in-person, by-appointment showings, while technically now legal, are only permissible if all virtual options are impossible.

Yes, Realtors are essential workers, but in order to get to the point where they can actually bring someone to a property, they must first exhaust all other methods. “All appointments and viewings must happen virtually,” begins the SFAR. “If a virtual viewing is not possible, then a single photographer or videographer is permitted to visit the property once to take photographs and/or video.” If that is not possible, then the agent can set up an appointment for one or two clients “from the same household” to tour in-person, provided there’s nobody home and the clients are accompanied by only one agent.

They’re not messing around here, folks. The punchline is that in order to get a potential buyer into a listing, that listing has to go live without any online photos and/or a virtual tour — two key elements to marketing a property. Honestly, in order to find a listing without photos or a tour you’d have to first find a time machine and set it to 1997.

Technology has always occupied something of an awkward place in the real estate world. Brokers and marketers have been touting the need to “stay ahead of the curve” on technology for years while simultaneously struggling with its actual applications in real estate. One agent I talked to sounded an optimistic note, mentioning that he hoped “sheltering in place would up the standard of practice for digitally marketing real estate.”

“Buyers appreciate things like Matterport 3D tours, high-quality photography, producing floorplans,” he continued. “Hopefully this will all become normal.”

Even if they do, I think the endgame for technology is in helping buyers whittle down choices, not in making their ultimate choice. While I did walk away from a virtual open house a few weeks ago convinced I had seen the future of open houses, I still think it’s going to be difficult to convince someone to pull the trigger before they’ve actually been in the house. It’s as much an emotional decision as a financial one.

But who knows? We buy everything from paper clips to 90-inch TVs on Amazon. Maybe eventually we won’t need in-person home tours.

Now is not that time, though. Last week, agents were looking forward to May 4 with anticipation. This simple change — allowing in-person tours — would bring the market roaring back to life. But now they’re confused; are they allowed to show homes or not? If a home has photos online but their buyer wants to see something not shown, then is it OK to take them to the home?

Word on the street is that some agents are skirting the rules, some consciously (out of habit, likely) but others because they’re just not certain what’s allowable and what’s not. What we do know is that in one important way real estate is mimicking the rest of society: It doesn’t know how and when this crisis ends.

The Market Musings real estate column appears every other Wednesday. Larry Rosen is a San Francisco-based writer, editor, podcaster and recovering former Realtor. He is a guest columnist and his viewpoint is not necessarily that of the Examiner.

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