C.A.R.'s Guidance on Governor's Stay-at-Home Order
Updated on March 30, 2020
UPDATE: On Saturday, March 28, the U.S. Department of Homeland Security Cybersecurity and Infrastructure Security Agency (CISA) updated its list of essential services during the coronavirus (COVID-19) crisis and expressly included residential real estate. Since Governor Newsom’s March 4, 2020 order incorporates this list, the order now includes residential and commercial real estate, including settlement services, as essential services in California. However, if a city or county has an order with a more restrictive standard regarding what qualifies as an essential service, or more restrictions on activities, those guidelines will still govern the activities of a licensee.
Notwithstanding this new development, all real estate licensees must take into account the health and safety of their clients and fellow licensees, and follow the existing protocols for protecting against the spread of COVID-19. If such health safeguards and protocols are not followed, the rule for the state could easily change to stop or restrict all real estate activity.
To that end, in conformity with current health guidelines, real estate licensees should follow all CDC and local health mandates.
1. No open houses should be held.
2. Showings should be done virtually, if at all possible.
For more information, see C.A.R.'s Guidelines for Best Practices.
On March 19, Governor Newsom and the State Public Health Officer issued Executive Order
N-33-20 requiring all Californians to stay home except as needed to maintain continuity of operations in 16 infrastructure sectors. This supersedes all existing local city and county orders that are less restrictive. The real estate industry is not exempt from this prohibition except as needed to maintain “continuity of operation … of … construction, including housing construction.” Therefore, REALTORS® should conduct as much of their business as possible using virtual means.® REALTORS® should cease doing all in-person marketing or sales activities, including showings, listing appointments, open houses and property inspections. Clients and other consumers are also subject to these orders and should not be visiting properties or conducting other business in person.
Property management and repair work, which generally involves maintaining sanitary and safety conditions is permissible. Additionally, many other aspects of the real estate industry can continue to occur without in-person contact, including documentation and signing, and in many circumstances, closings. Other activities may also be managed remotely, though there may be some difficulties.”
Impact on MLS Statuses, Showing Instructions and DOM
In light of Governor’s Order of 3-19-20, in many instances, these conditions will prompt listing agents, in accordance with seller’s wishes, to change the MLS listing status to something like hold or withdraw – but if the listing agreement is still in effect, one would not select cancelled. Listing agents also have the option to maintain the listing in an active status, (or coming soon/delayed showing if such status is offered and appropriate under local MLS rules) albeit with an understanding of the limitation imposed on all face-to-face activity. Agents will have to be mindful of the implications of each status selection within their local MLS rules.
Under these extraordinary circumstances, if so desired, an MLS in its discretion could elect to alter its usual Showing Instructions and/or DOM approach, either by taking a unilateral approach systematically in the MLS such as temporarily de-activating the field, or, as referenced above, simply continuing to offer participants the option to alter their status designation into a field that suspends showings and/or the clock ex: hold or other options in one’s system. Under either scenario, it's a given that all California listings are subject to this same Order of 3-19-20 causing all listings, active or otherwise during this time, to be assessed in the same light.
If an MLS does alter or suspend the DOM, keep in mind, however, portals like Zillow, Realtor.com and others who also calculate their own DOM might not be changing their DOM calculations. That raises the concern of having 2 differing, publicly available DOM sources possibly causing the buying public to lose confidence in the MLS reporting and/or creating potential liability situations for agents for inaccurate reporting. Thus, if an MLS does decide to pause the DOM calculations, best practice would be to keep measuring things both way so that future evaluation of this current marketplace will be possible. When this is all over, it will still be important to keep an accurate tracking of what happened, so even if the DOM clock stops, the CDOM clock should keep going so the total picture is still there.
Also, this Inman article may be of interest regarding what some other MLSs are doing.
Based on that set forth above, the MLS has various options to consider depending on what works best locally and within the fields and functionality of its system.
Disclosure of Potential COVID-19 Exposure
What to do if a REALTOR® learns that a visitor to the property, including potentially another REALTOR®, tested positive to COVID-19 — is disclosure required or recommended?
This information would be material to anyone at risk for potential exposure but raises the question of whether it’s a property concern or a people concern. Is the concern that the property site itself might have been or is contaminated? Or is the risk having been around a particular person? And was this person on or off site from the property?
Per the CDC, it’s possible the virus can spread from contact with infected surfaces or objects on a property, meaning a person could get COVID-19 by touching a surface or object that has the virus on it and then touching their own mouth, nose, or possibly their eyes, but this is not thought to be the main way the virus spreads. Based on this CDC information, the more relevant aspect to potential exposure pertains to the timing of contact with the property and the infected person and any others who came for a period thereafter.
A main concern would be if a REALTOR® becomes aware that someone who has entered the house or come in contact with other people in the house or the REALTOR®, what steps should the REALTOR® take. This is not purely or a per-se property condition that universally must be disclosed to a buyer in a transaction. In addition, it is not solely the buyer who the REALTOR® has to consider notifying. The REALTOR® has fiduciary duties to the client and should definitely inform the client of this situation. Further, the REALTOR® (and potentially, the seller/landlord) may have certain duties to those that have entered the house for showings, appointments, inspections, etc. Hopefully, the REALTOR® has a contact log for those that entered the house during the term of the agency.
To be on the safe side, it is probably best for the REALTOR® to make reasonable efforts to disclose this information to anyone who might be affected by this situation, both legally as well as for social policy reasons of trying to reduce the spread of COVID-19. But how? Disclosing through the MLS would not be the most effective way to communicate this information because (a) no further showings should be ongoing under the Order of 3-19-20, and (b) the concern at issue is backward-oriented and person-focused (and not a permanent property condition) for those potential visitors and/or REALTORS® identifiable from lockbox or other records as having been at the property during that time period with the exposed person. Notice could then be given in a targeted way.
If making a disclosure, it should be done in a generic way so as not to invade one’s privacy or implicate personal information. This would mean not using names but a general description along the line of “a visitor to the property on x date has tested positive to COVID-19.”
The CDC provides the following notice advice in the employment context – albeit not an apples to apples comparison to the fact pattern of listing/showing a home, but it could be looked to for guidance: If an employee is confirmed to have COVID-19, employers should inform fellow employees of their possible exposure to COVID-19 in the workplace but maintain confidentiality as required by the Americans with Disabilities Act (ADA). Employees exposed to a co-worker with confirmed COVID-19 should refer to CDC guidance for how to conduct a risk assessment of their potential exposure.