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Post-Election Real Estate. What should we expect next in our industry?

Propy’s weekly webinar Episode #30 is with Pete Zizzi, Team Leader/Associate leader of The Zizzi Team, RE/MAX Plus.

Pete Zizzi, Team Leader/Associate leader of The Zizzi Team, RE/MAX Plus in Rochester, NY, along with Propy’s CEO Natalia Karayaneva and William Dickey, Tech advisor, discuss the impact of the recent election on real estate, along with proposed changes in real estate policies in two states. New York is changing how agents can post real estate listings, and California has three Propositions on the ballot. We will cover what these changes mean both for the realtor and the consumer.

Post-election uncertainty

Pete Zizzi feels that any uncertainty is bad for the real estate market, just like it impacts the stock market, and hopes that the election results will be determined quickly. We have had a trend of uncertainty all year long, but for different reasons. With a very low inventory situation in Rochester and most of New York state, prior to COVID, the concerns about selling centered on whether the seller would be able to find a new property to purchase, according to Zizzi, whether they were moving up or downsizing. People have not been confident that they could find what they wanted in a new home. Once COVID hit, the economy and job security became a big concern for many people on the fence about selling or buying.  With the election results pending, there is still a feeling of uncertainty. But the reality is that people still need a place to live. It’s still a hot market, and properties are moving well.

Real estate advertisements changes in New York State 

Zizzi explains that there is a new rule now that states that anytime a real estate agent pays for an advertisement on a third-party website, and it has your name on it next to another broker’s listing, you have to add an acknowledgment that it’s an advertisement and not your listing. For example, if I see a really awesome listing and I want to post that to my Facebook page, I need to get permission from the broker of that listing, and I have to state that it is not my listing.  This is a helpful law as it prohibits an agent from gathering leads on a listing that is not theirs.

How COVID is affecting Landlords

As a landlord, Zizzi states that he still has taxes, insurance, and the mortgage to be paid on his rental properties. Initially he was able to get forbearance with the banks, and that allowed him to cut his tenants rent in half for 90 days. The challenge for landlords is the forbearance needs to be extended longer, or other relief packages need to be given. Most of the relief is being focused on the renter, and it’s critical that the banks work with the landlords as well. One concerning issue is the language of the eviction moratorium is too vague. Tenants should have to prove that they are unable to pay rent. As it stands, many landlords have renters claiming they can’t pay, and the landlord is unable to verify that.  They effectively have squatters living in their properties, with no way to evict them currently.

Overview of California propositions 19, 15, 21

Proposition 19 (Accepted) allows homeowners 55 and older, the severely disabled, or the victims of wildfire, to bring their favorable property tax rate with them wherever they move for up to three moves. This proposition will help homeowners tremendously, and real estate agents in California are supporting this.

Proposition 15 (Rejected) taxes properties based on current market value rather than purchase price and increases property taxes on commercial properties for funding to local governments and schools.  For example, if someone purchased a house 50 years ago, they currently are being taxed on that original value, not today’s market value.

Proposition 21 (Rejected) allows local governments to establish rent control on residential properties over 15 years old. Currently this proposal has been rejected. California is going through an affordable housing crisis. Prices have skyrocketed because of the influx of high-tech companies in some areas. The every-day workers—the janitors, restaurant, and retail staff—can no longer afford housing and have unsustainable commutes or living in poor quality housing.

How to prepare for challenging times

Zizzi feels it is critical that agents really look at their expenses, and know where every penny is going. It’s important to have 3-4 months of earnings in savings to cover you in case of another shut-down, or the market slows.  Plan ahead and cover your bases to stay financially secure during these challenging times.

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