A backlog of requests to property managers and to county clerks’ offices, some of which are closed or are working shortened schedules, has made it harder to determine what is currently owed in taxes or unpaid utilities, so title companies are holding estimated fees in escrow to help move deals forward, said Yariv Ben-Ari, a partner at Herrick, Feinstein. Despite the hurdles, deals are still proceeding, he said.
The concept of “force majeure” — akin to an act of God or superior force — is making its way into more closing contracts, to indemnify parties from missed deadlines or other forms of liability caused by the pandemic, agents said.
The most immediate question for buyers and sellers is figuring out how prices have been affected.
“Nobody knows exactly what’s going to happen to values,” said Cathy Taub, a Sotheby’s International Realty agent and co-chairwoman of New York Residential Agent Continuum, an agent advocacy group. “It was already a difficult market before Covid.”
Heather McDonough Domi, a Compass agent and co-chairwoman of the same group, said she has already received an opportunistic offer, in which the prospective buyer saw the property before the outbreak reached New York, and is now offering 20 percent below the asking price.
Even though real estate appraisers are considered essential workers, nearly all inspections are now being done remotely, using recent sales and neighborhood data to determine value, said Mr. Miller, the appraiser. But sales before the outbreak are no longer a reliable basis for comparison, he said, so appraisers are adding caveats to their reports, like they did after Sept. 11 and the 2008 financial crisis, citing the unknown effect of the outbreak.
The hope is that pent-up demand will help mitigate the damage done during what would have been a busy spring buying season.
“My position as an appraiser is I’ve got to get through the next six months, and we’ll have more business than we know what to do with,” Mr. Miller said. “Lots of refinance, foreclosures, workouts, and, I’m assuming, a lot of divorces.”
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