How Realtors innovate in the time of COVID-19

Melinda Rizzo, Contributing Writer//May 5, 2020

How Realtors innovate in the time of COVID-19

Melinda Rizzo, Contributing Writer//May 5, 2020

How far will the Covid-19 global pandemic push the real estate industry?

Since Gov. Tom Wolf’s March shut down of all but essential Pennsylvania industry sectors, real estate professionals have had to find creative ways to adapt.

“At the moment we are doing closings on the back porch with a table and passing documents to buyers and sellers,” through a window, said Kathie Vresics, manager Associated Abstract Services LLC in South Whitehall Township.

Associated Abstract provides title search and notary services for real estate transactions.

Vresics said settlement participants come separately and the table and transaction area is sanitized between participant’s signature rounds.

“No one is allowed in the building. They receive documents through the window and return them, so there is no face-to-face contact,” Vresics said.

It is anyone’s guess how long strict social distancing practices will continue, in an uncertain and unknowable Covid-19 future.

Nixing In-person legal requirements for notaries and title companies, as well as lender mandates for “wet” witnessed signatures on paper documents have created problems in both the residential and commercial real estate marketplace. A wet signature is traditional ink on paper.

“In the real estate industry you have always had an original signed deed and title. The recorder’s office would not accept them otherwise,” Vresics said.

A temporary order allowing digital notary transactions, which expired April 30, make use of Remote Online Notarization, or RON, but only some deed recorders allowed them.

The Pennsylvania Department of State website said RON transactions require the signer to meet via audio-visual-electronic communication technology.

Vresics said many notaries support Remote Ink Notarization (RIN) which would help get documents to buyers and sellers. Using RIN allows participants to sign on camera, with the video record being proof of signing.

She said with RIN documents would then be couriered overnight, but “I do think there will be some resistance from lenders,” to RIN transactions, Vresics said.

She said beyond Covid-19 RIN signings could ease the burden on transactions where people cannot come to closing, such as those in a nursing home. “We do have to make other arrangements for them to sign. If we can continue with this (RIN) we’d have another option,” Vresics said.

Moving forward, without government action on extensions or new legislation to allow virtual or alternative notary services Vresics expects newer contracts will not be able to close.

She expects more electronic options to grow out of Covid-19, like electronic document recording or E-Recording, is currently used in some county courthouses for deed transfers. She thinks E-Recording will grow and more electronic platforms could be developed out of the Covid-19 response.

Nick Kavounas said his team at Coldwell Banker Heritage Real Estate in Bethlehem Township is learning new ways of doing business. He is Coldwell Banker general manager and broker of record.

Regular zoom staff meetings help agents and employees remain connected. Newer 3-D tour software provides a way for virtual property tours to be conducted, including floor plans for each level of a home. “You can [virtually] go through the home as if you are walking through it,” Kavounas explained.

One of the software’s functions allows for room measurements for furniture placement and window treatments.

Coldwell Banker was using the 3-D software for about a year prior to the pandemic closures.

Kavounas said both January and February were strong and there was a lot of agent and broker optimism early in the first quarter of 2020. “Buyers were still active,” he said.

All the elements for a strong sales year were in place, but the key time in the business cycle has past. Kavounas believes a lot of pent up demand for properties remains.

On the back end of a sale face-time technology can be an option for final inspections ahead of settlement. Lisa Meszler Lyon has used face-time to conduct the buyer inspection of a commercial apartment building. She is a commercial real estate agent at Alt Realty in Bethlehem.

“We couldn’t have a [physical] walk-through, and we did not want to rely on a paper trail so the buyer did a face-time walk through,” Meszler Lyon explained.

Because perceptions are as unique as fingerprints Meszler Lyon said relying on a seller to show an investment property can become tricky using video technology or still photographs, over a physical face-to-face on site inspection.

Putting trust in someone who wants to sell the property can cause questions and to arise, such as “‘is there something going on I don’t know about,’ or ‘why didn’t I see this apartment over a different apartment,’” Meszler Lyon said.

While the move to virtual video calls over physical site inspections is a stop-gap during the pandemic to accommodate social distancing rules, Meszler Lyon isn’t convinced commercial sales transactions will change much in the long term.

“When you are spending a couple million dollars, you want to see your product,” she said.