What Does Phase 2 Re-Opening Mean for NYC Real Estate?

NYC entered Phase 2 of the New York Forward Reopening plan on June 22nd, 2020. As part of this new stage of reopening, in-person real estate showings will once again be permitted in New York City.

In-person real estate activities are subject to a range of new restrictions and required safety protocols imposed by Empire State Development and the Department of Health as well as other suggested best practices from REBNY and NYSAR, such as a health screening questionnaire and a COVID-19 disclosure form.

It’s important for real estate agents, sellers and buyers alike to understand what in-person activity will finally be permissible again as part of Phase 2 in NYC.

Previously, New York City entered Phase 1 of New York’s 4 phase re-opening plan on June 8th, 2020. The New York Forward Plan requires a minimum two week interval between phases.

Are in-person showings allowed in Phase 2 in NYC?

Yes, in-person showings are allowed but shall only be performed by the seller’s agent while maintaining at least six feet of social distance between parties not of the same household.

For the avoidance of doubt, neither the seller nor the buyer’s agent should be present. Furthermore, appointments should be held by appointment only, meaning no traditional open houses should be conducted.

Here are some additional considerations and guidance from REBNY for Phase 2 re-opening in NYC:

  • All parties attending a showing must wear appropriate face coverings for the duration of the appointment. This expectation must be established ahead of time via email agreement. Should any party arrive without a face covering, or upon any indication of fever or other illness, either party may cancel or postpone the appointment without prejudice or penalty.

  • Buyer’s agent is encouraged to attend via video-conference or other virtual means. In-person attendees should be limited to seller’s agent and buyer, with buyer’s agent attending virtually.

  • If six feet social distance cannot be maintained for all parties, attendees should be limited to one person inside the property at one time.

  • Only the seller’s agent opens doors, cabinets, etc. Buyer or buyer’s Agent will be asked not to touch anything inside the property at any time (with the exception of essential surfaces such as handrails, etc.). If Buyer’s agent is not in attendance, seller’s agent should escort buyer to lobby prior to arrival of following appointment.

  • Following current CDC guidelines, seller’s agent must clean and disinfect all frequently-touched areas and surfaces inside the property upon the conclusion of each appointment.

As you can see from the language above, it appears that REBNY is strongly suggesting that buyer’s agents not attend any showings, but is not saying that buyer’s agents are outright prohibited from attending showings. This is consistent with the New York State Association for Realtors guidance for the rest of New York State.

Remember that most condo and co-op buildings in NYC will have their own, often stricter set of rules around visitation, showings and open houses.

Phase 2 re-opening means in-person showings are permissible when done in conjunction with proper safety procedures and social distancing. Details & more.

Are open houses by appointment only allowed during Phase 2 in NYC?

If open houses are allowed by the building, then REBNY says that “open houses should be conducted by appointment only, with one party inside the property at a time. Prior to advertising any appointment-based open house, agents should review and confirm designated protocol as established by the building for such interactions. Appointment based open houses should not be conducted if maintenance of appropriate social distance of six feet is not possible for all parties at all times.”

Sellers and listing agents should also remember that many third party listings websites may not allow the posting of open houses during the pandemic, and it remains to be seen when such restrictions may be lifted.

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How can sellers and listing agents limit their liability due to COVID?

COVID disclosure form

Agents should have any party entering a property sign a COVID disclosure form to limit any potential liability from exposure to COVID. This is quite important especially since it is difficult to prove where any COVID patient became infected, and as a result it can be quite easy to assume liability even if the agent takes all recommended precautions.

Per guidance from REBNY on limiting agents’ liability due to COVID:

Agents must always comply with respective building and management guidelines. Prior to arriving for any showing, agents should familiarize themselves with such protocols, including but not limited to, designated hours for showings, elevator usage and access to amenity spaces, etc.

Where a REBNY member is involved with the coordination of in-person/on-site visits to a property by either vendors or consumers, a “Limitation of Liability” form should be utilized.

The purpose of the form is to advise any party who is entering a property, or who is permitting another party to enter a property, of the potential liability that may result from exposure to the Coronavirus (COVID-19). By signing the form, such party acknowledges and assumes the risks associated with conducting property visits in-person, including potential exposure to the Coronavirus (COVID-19) and the consequences that may result from such exposure.

A REBNY member who is involved with the coordination of in-person property visits should provide the form to the parties who will be involved in such visits. The form should be used for in-person visits to both residential and commercial properties.

Health screening questionnaire

Agents and sellers should ask all potential visitors to a property to first fill out a health screening questionnaire to determine whether said visitors have COVID, have COVID symptoms or have been in contact with anyone who has tested positive for COVID or has COVID symptoms within the past 14 days.

If you decide to exercise this precaution, remember to apply the requirement to all potential visitors in order to comply with federal, state and local fair housing laws.

Per guidance from REBNY:

A health screening should be required of all agents and consumers attending in-person showings using this health screening questionnaire which determines whether such person has:

a. Knowingly been in close or proximate contact in the past 14 days with anyone who has tested positive for COVID-19 or who has or had symptoms of COVID-19

b. Tested positive for COVID-19 in the past 14 days, or

c. Experienced any symptoms of COVID-19 in the past 14 days

Should an agent choose to implement this precaution, they must practice it uniformly for all in-person interactions in order to remain compliant with Fair Housing rules and regulations. Each person must be presented with, and answer, the questions set forth in the questionnaire. If someone refuses to answer the questions, or answers the questions affirmatively, then such person will not be permitted to attend the showing.

General precautions to take during showings

To limit unnecessary exposure, agents should always consider holding initial meetings via telephone or video-conference (i.e. a live virtual tour) before moving on to an in-person showing. However, with the prevalence of pre-recorded 3D virtual tours and video tours available today, most preliminary showings are no longer necessary.

Should an in-person showing still be necessary, then REBNY offers the following guidance:

Should an agent proceed with an in-person showing, the following general protocol should be implemented, only after the agent has discussed precautions and a safety action plan with the seller. Showings and open houses will only be allowed in unoccupied (i.e. seller is not inside the property) or vacant properties.

  • Per current CDC guidelines, seller’s agent must clean and disinfect all frequently-touched areas and surfaces in the space before and after every appointment.

  • Agents should establish with buyers and/or buyer’s agent ahead of time that appointment start and end times are finite in order to allow for appropriate time to clean and disinfect the property in between appointments.

  • Seller’s agent must provide alcohol-based hand sanitizer and/or hand soap and paper towels to all visitors upon arrival.

  • Do not shake hands during in-person interactions.

  • Any party may cancel or postpone a showing without prejudice or penalty upon any indication of Coronavirus (COVID-19), cold or flu-like symptoms.

  • Attending parties should check their temperatures at home to ensure it is below 100.4° F prior to arriving for a showing.

  • All parties must wear appropriate face coverings during a showing. Should either party arrive without an appropriate face covering, any party may cancel or postpone the showing without prejudice or penalty.

  • When possible, seller’s agent should open unit windows to introduce fresh, outside air.

Keep in mind that listing agents can negotiate with sellers in advance on who’s responsible for providing and paying for cleaning supplies, hand sanitizer etc.

For example, a listing agent with a traditional 6% commission listing agreement might not mind going out of pocket for some hand sanitizer for buyers to use, but a flat fee MLS listing seller will certainly be expected to provide all cleaning equipment and to clean everything him or herself.

Remember the key safety principles of the lockdown, per guidance from REBNY:

  • Understand the facts: Continue to check CDC, NYS and NYC updates and guidelines.

  • Social distancing: Public health authorities have recommended maintaining at least six feet social distance as a key strategy to reduce the spread of the Coronavirus (COVID-19). Social distancing should be maintained for all in-person interactions.

  • Meetings and events should be conducted via phone or videoconference whenever possible.

  • Sanitation: Clean and disinfect all frequentlytouched objects and surfaces, per current CDC and New York City Health Department recommendations. Click here for recommended disinfectants for use against SARS-CoV-2.

  • Hygiene: Wash your hands frequently with soap and water for at least 20 seconds. If not available, use hand sanitizer with at least 60 percent alcohol as recommended by the CDC.

  • Wear face coverings: Given the consistent challenge to maintain six feet social distance throughout residential real estate transactions, all parties should wear appropriate face coverings during all in-person interactions.

  • Stay home: If you, or anyone you have had close contact with in the previous 48 hours is experiencing symptoms of the Coronavirus (COVID-19) or has tested positive for COVID-19, stay home and avoid close contact with others.

  • Seek help: Call the NYS Novel Coronavirus hotline if you have questions relating to the Coronavirus (COVID-19) or suspect you have been exposed (1-888-364-3065).

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What does Phase 2 mean for the rest of New York State?

All regions in New York State outside of NYC are in Phase 2 or greater as of this writing. Currently, the Mid-Hudson region which includes Westchester County and the Capital Region are in Phase 2. All other regions outside of NYC are already in Phase 3 as of mid-June, 2020. You can get an up to date map of which phase your region is in here.

The New York State Association of Realtors (NYSAR) provides an excellent summary of the Interim Guidance Document issued by Empire State Development and the Department of Health. An official summary of the Interim Guidance Document can be found here.

You’ll find that NYSAR’s guidance is very much aligned with REBNY’s guidance when it comes to Phase 2 for real estate brokerage activities.

Similarly to REBNY, NYSAR states that brokers are encouraged, though not required, to conduct remote vs in-person showings. If a showing must occur, it should be done in an open, well ventilated space and all parties should wear appropriate face coverings and maintain social distancing.

Unique to upstate New York and areas outside of NYC where driving to appointments is the norm, NYSAR says “licensees should avoid driving in the same car with prospective tenants/buyers. If this cannot be avoided, face coverings must be worn by everyone in the vehicle and frequently touched areas of the vehicle should be cleaned and disinfected.”

Additional, NYSAR recommends the following for in-person showings:

  • May only be conducted in unoccupied (if there is an occupant, they must not be present) and vacant property.

  • Licensee must limit the number of individuals viewing the property.

  • Licensees should schedule all showings in advance, whenever possible.

  • Licensees and consumers must wear an appropriate face covering at all times.

  • Gloves and shoe coverings can also be required by the owner or broker.

  • Brokers must provide appropriate face coverings to licensees and consumers.

  • Licensees should not dispose of PPE at the property being shown.

  • Consumers should be instructed to only touch essential surfaces, such as the use of a handrail to go up or downstairs. Consumers should be instructed not to touch other areas or surfaces including cabinets, countertops, appliances, etc.

  • Licensees are responsible for cleaning and disinfecting high touch surfaces such as doorknobs and handrails. As a best practice, licensees should disinfect every surface that was touched during a showing.

  • Showing times should be staggered so as not to have the next scheduled buyer/tenant waiting outside for the current showing to end.

  • As a best practice, only one party should be in the property at a time. If more than one party is inside the property at the same time, 6 feet of distance must be maintained at all times between individuals, and face coverings must be worn (face coverings are already mandatory).

  • Licensees and buyers/tenants are encouraged not to bring young children or extraneous guests to property showings, when possible, or leave attended children outside.

Additionally, NYSAR also recommends that licensees should “screen each seller/buyer/landlord/tenant prior to a showing,” though we think the wording of the Interim Guidance Document suggests that screening is more of a requirement vs an optional precaution.

Lastly, here’s what NYSAR had to say about open houses:

  • Although the Guidance Documents permits open houses, it includes restrictions.

  • Only one party may be inside the property at a time. The licensee needs to be sure no other parties can enter.

  • Licensees choosing to hold a traditional open house run the risk of multiple parties congregating outside the property waiting for their turn to view the property or attempting to enter the property while another party is inside. Licensees should make every attempt to schedule showing times for an open house to avoid such issues.

  • Licensees should not dispose of PPE at the property where the open house is held.

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Disclosure: Hauseit® and its affiliates do not provide tax, legal, financial or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, financial or accounting advice. No representation, guarantee or warranty of any kind is made regarding the completeness or accuracy of information provided. Hauseit LLC is a Licensed Real Estate Broker, licensed to do business in New York under license number 10991232340. Principal Office: 148 Lafayette Street, New York, NY 10013.

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