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Home Business • Finance

Would you buy a home without touring it in person? For a growing number of buyers, the answer is yes. Here’s why.

by Edinburg Post Report
February 12, 2023
in Business • Finance
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Would you buy a home before seeing it in person? First-time homebuyers Kari and Nolan Greiter did.

The Greiters lived in Wrigleyville for almost two years after moving from Florida. Kari, 33, who is a schoolteacher, and Nolan, 32, who works in advertising, had no real estate experience other than renting. They started looking at properties through online sites and eventually connected with Tony Mattar, real estate agent at Compass.

Then the pandemic hit. As the world temporarily shut down, the Greiters moved to Iowa to be near family but continued searching for a home in Chicago.

Nolan was surprised at how easy it was finding online properties they liked. If one interested them, Mattar set up a FaceTime call for a walk-through. “We could experience the condo and Tony could give us his take and impression,” Nolan said.

The process wasn’t anxiety free. “We were on a timeline because I was pregnant,” Kari said. “With the pandemic, I was learning how to do my career in a completely different way.” Plus, her previous experience moving into an apartment that she’d not seen before made her nervous.

After giving a virtual showing of a home, Compass realtor Tony Mattar records a second walk-through video on his phone, showing the facade of the house on Feb. 3, 2023, for the client to use in considering purchasing the property. (Chris Sweda / Chicago Tribune)

Trust is the key. “I don’t think it would have worked as well virtually, if we didn’t have a partner that we could fully rely on,” Nolan said.

Ultimately, after looking at 10 different properties virtually from Iowa, the Greiters made an offer on a condo in Logan Square in May 2020. It was accepted without a counter.

“It felt right,” Kari said of the first time they stepped into their home after buying it sight unseen. “We experienced everything that Tony had talked about. I don’t think there were any specific details that we had not covered in our virtual tour, which made us feel like, OK, Tony did it. We were very happy.”

During COVID-19, virtual showings “started snowballing and became much more common,” said Mattar, whose team focuses on the North Side of Chicago. Initially, he showed properties using FaceTime or GoogleMeet with his phone, followed by a video of a second walk-through. The video helped, because “spatially, homes aren’t always represented 100% accurately through photos. It’s hard to get a sense of flow from room to room.”

He estimates his virtual showings during the past two years to be tenfold over the previous seven years combined.

“It’s been across the board in terms of ages, genders, all kind of demographics. It’s not only people under 30. It seems to be a very broad trend,” Mattar said of those who buy homes virtually.

The National Association of Realtors first started collecting data on virtual real estate transactions in April 2020, according to Jessica Lautz, deputy chief economist and vice president of research. Virtual home sales, which are sometimes referred to as “blind offers” or “sight unseen sales,” peaked at 13% of all transactions in January 2022. By November 2022, that number dropped to 9%.

After giving a virtual showing of a home, Compass realtor Tony Mattar records a second walk-through video on his phone on Feb. 3, 2023, showing details of the house for the client's further consideration.

After giving a virtual showing of a home, Compass realtor Tony Mattar records a second walk-through video on his phone on Feb. 3, 2023, showing details of the house for the client’s further consideration. (Chris Sweda / Chicago Tribune)

After giving a virtual showing, Compass realtor Tony Mattar uses his phone on Feb. 3 to record a second walk-through video showing details of the house for the client to use in considering purchasing the property.

After giving a virtual showing, Compass realtor Tony Mattar uses his phone on Feb. 3 to record a second walk-through video showing details of the house for the client to use in considering purchasing the property. (Chris Sweda / Chicago Tribune)

Lautz sees two drivers for virtual sales, beyond the pandemic. “It’s not only because inventory is tight, but people are moving longer distances. It might be very difficult to make your way to that home before it is under contract,” she said. “If you’re moving to a different state, the ability to quickly book a flight because that perfect home has just come onto the market may be impossible.”

Although virtual sales are occurring all over the country, it’s difficult to compare activity between cities. Tabitha Hippolyte, a real estate agent in Atlanta, Georgia, with Coldwell Banker, has closed four virtual home sales. Once she learned how to use tools like WhatsApp and Zoom and Matterport photography services, which offers 3D space photography, Hippolyte found that the process for each transaction depended on which tool was preferred by the client. She estimates that 90% of her clients are millennials.

Corey Booth, with Monument Realty in Rockwall, Texas, closed seven home sales virtually during the pandemic. All seven were out-of-state buyers from New York, Chicago and California.

The trend isn’t limited to large cities. Stephanie Arnett, with Mississippi Magnolia, in Starkville, Mississippi, a college town in a country of roughly 50,000, has been in real estate for 20 years. Virtual tours are customary for all of her listings: “Every single house, regardless of dollar value, that’s part of what (sellers) get offered. Anyone can put on an Oculus headset and walk through the entire house.”

For buyers, Arnett conducts a live virtual showing as well as a second recorded walk-through. The pandemic dramatically increased her virtual business. She estimates 15% to 18% of the nearly 200 closings her team processed in 2022 were virtual or blind offers. When it comes to homes that sold virtually, she sees no pattern in the income or education of the buyers or price of the home. It merely comes down to whether the client is “comfortable with technology,” she said.

Lautz sees virtual transactions continuing, even if they’re less frequent. “If you had asked me that at the start of the pandemic, I would have thought it was a fluke. But it seems to be here to stay.”

Virtual transactions may reflect another shift, as the National Association of Realtors sees the median distance folks relocate increasing to 50 miles. “It makes sense because of housing affordability, people are moving farther out because of hybrid or remote work,” Lautz said. Being close to friends and family is top priority for so many buyers today, so they may be moving to a different area to seek that.”

After giving a virtual showing of a home, Compass realtor Tony Mattar records a walk-through video on his phone on Feb. 3, 2023, showing the neighborhood outside for the prospective purchaser's consideration.

After giving a virtual showing of a home, Compass realtor Tony Mattar records a walk-through video on his phone on Feb. 3, 2023, showing the neighborhood outside for the prospective purchaser’s consideration. (Chris Sweda / Chicago Tribune)

Hippolyte prefers to meet clients in person, but says tying more technology into her business has helped her work with more people. Plus, if the market becomes tight again, she sees virtual showings and blind offers resuming, “because if they don’t get to see a house in the first 48 hours, they’ll be outbid.”

“Our team is doing more virtual showings now than I experienced pre-COVID,” Mattar said. “There’s definitely a lot more willingness and readiness from buyers to use technology as part of their real estate transaction.”

Similarly, Booth, in Texas, recognizes that “there’s a whole generation of buyers so used to doing things online that it’s almost second nature. I don’t think it’s going to dissipate, but it definitely takes a special person.”

Real estate agents say the past several years have reinforced that they can function as resources beyond the basics of the transaction. It’s “the ability for a seasoned real estate professional to speak to the nuances of a city, the transportation, the different neighborhoods and school districts, how neighborhoods relate to each other, and what changes are occurring that can guide people,” Mattar said. An understanding of how a city works “goes far beyond my job as someone who sells a piece of real estate, and bleeds into an expertise on Chicago, the market, the geography, and all of the things that make our city tick.”

Although virtual real estate transactions may become more common, technology has not yet replaced everything, particularly the element of trust. Whether in Chicago or elsewhere, that aspect remains a critical aspect of buying a home.

How do the Greiters feel about the virtual homebuying process today, especially now that they have two young children? “I kind of enjoyed it, honestly,” Nolan said. “It gave us the freedom to be specific.”

Yet, perhaps a blind offer would only be a matter of necessity.

“I would definitely do some virtual tours to start,” Kari said. “But as I get down to my final view, I would have to go in person.”

John W. Bateman is a freelance writer.

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