by | Apr 14, 2020 | Commercial real estate, Real estate sales

To say that we are living in uncertain times due to the COVID-19 crisis would be an understatement.  Aside from the enormous toll the pandemic is having on the physical and emotional well-being of millions of people, it is also impacting the world of real estate in ways that could not have been imagined before the crisis began.  To help you navigate through these challenging times, this is the first in a series with our answers to some of the most frequently-asked questions we’re receiving from commercial and residential buyers, sellers, landlords, tenants, brokers, and others involved in the real estate industry. (NOTE:  Things are changing literally daily, so the comments expressed in this series are subject to change as well.)

PROBLEM:  At this time of extreme uncertainty, many investors and homeowners would like to sell or buy their residential and/or commercial properties.  This raises the following crucial threshold question.

QUESTION:  Can residential and commercial real estate still be sold while the COVID-19 crisis is ongoing?

ANSWER:  Yes, at least for now, but with severe restrictions.

Residential and commercial real estate services, and government staff who support such services, are considered “essential services” by the U.S. Department of Homeland Security, whose list of “essential services” is adopted under Governor Newsome’s March 19, 2020, Executive Order.  However, some local jurisdictions have a much narrower definition of what real estate services are “essential,” and place restrictions on how the services are to be provided.  For example, San Mateo County considers only residential real estate to be an “essential” business exempt from the stay-at-home order, and then only if the sale is “absolutely necessary at this time,” such as if it involves a healthcare professional transferring into or out of the County. Otherwise, that County permits realtors to work only from their own homes, and prohibits open houses under any circumstances.

And although most documents such as Purchase Agreements, Addenda, Contingency Removals, Leases, and the like have traditionally been completed and signed electronically, and remotely, for many years, because of the current crisis the process must be handled very differently in many other respects and is likely to take much longer to complete.  For example, because escrow and title company personnel are now mostly working remotely, the signing of closing documents is now being done with mobile notaries rather than in person with an escrow officer.  It is also taking longer for inspections and appraisals to be performed, perhaps due to a reduction in the number of inspectors and appraisers who are conducting business under the current circumstances.  The financing process may take longer due to lenders’ staff working remotely.  And most commercial and residential construction work (including pre-closing repair work) is prohibited while the stay-at-home order is in place.  To address these delays the California Association of Realtors (CAR) has prepared a Coronavirus Addendum/Amendment, and a Notice of Unforeseen Coronavirus Circumstances form, for the parties to use if closing needs to be delayed due to COVID-19-related issues.

Most importantly, CAR has issued its “Best Practices Guidelines” for how residential and commercial real estate transactions are to be handled from beginning to end.  In addition to requiring that, if at all possible, all showings be done virtually and all activities be completed electronically, the Guidelines refer to the Centers for Disease Control and Prevention (CDC) recommendations and place severe restrictions on showings, inspections, and other such activities involving people entering the property.  These include, among other things, limitations on the number of people who may enter the property at any time, and a requirement that anyone entering a property: 1) sign a written declaration that they are not currently ill or have symptoms and have had no contact with anyone with COVID-19, and agreeing to assume the risk of exposure in the property; and 2) wash their hands or use sanitizer and put on disposable rubber gloves and a face mask, if made available, before entering the property.  And if anyone who enters the property is later diagnosed with COVID-19, that person must immediately report that fact to the listing agent, who must make best efforts to inform everyone who entered the property of that fact.  These requirements and others are detailed in two additional new CAR forms, entitled “Coronavirus Property Entry Advisory and Declaration” and “Listing Agreement Coronavirus Addendum or Amendment.”

Finally, the stay-at-home orders of most local jurisdictions in California require residents to shelter at their place of residence, with limited exceptions, none of which specifically include seeing a property for potential purchase.  These orders further prohibit moving residences except under very limited circumstances.  As a result, and regardless of whether the transaction involves realtors or is a sale by owner, the severe restrictions placed on entering for-sale properties; the uncertainty as to whether it is lawful to leave one’s home and enter a for-sale property in the particular jurisdiction in which the property is located; the potential risk to sellers of someone entering the property with COVID-19; and restrictions on moving residences, may cause otherwise motivated sellers and buyers to hold off on any commercial and residential sales activities until the crisis is over.

If you need assistance or have questions regarding any of the above, or if you are involved with commercial or residential sales transactions that are proceeding, or those that must be postponed or cancelled due to the current crisis, we handle purchase and sale transactions and disputes involving those transactions and are here to assist you with your legal needs.

If you would like links to the following resources referenced above, please contact [email protected]:

  • U. S. Dept. of Homeland Security, Cybersecurity & Infrastructure Section, “Advisory Memorandum on Identification of Essential Critical Infrastructure Workers During COVID-19 Response, March 28, 2020”
  • Executive Dept., State of California, Executive Order N-33-20, March 19, 2020
  • San Mateo County Ass’n of Realtors, “Coronavirus: FAQ & Updates,” April 4, 2020
  • California Ass’n of Realtors, “Guidelines for Real Estate Best Practices During COVID-19, Updated on March 31, 2020”
  • 3/31/20 Order of the Health Officer of the County of Marin
  • California Apartment Ass’n, “COVID-19 What the rental housing industry needs to know”


Philip R. Diamond has been a practicing attorney for over 45 years.  In addition to real estate-related litigation, Mr. Diamond also handles real estate transactions, such as purchase and sale agreements, entity formation, and business buy-sell agreements.  Before becoming Of Counsel to LERMAN LAW PARTNERS, LLP, in 2004, Mr. Diamond practiced at prominent regional and national law firms and founded and practiced with two successful San Francisco Financial District boutique law firms. Mr. Diamond is also a highly experienced and skilled mediator and arbitrator (through his separate practice, DIAMOND DISPUTE RESOLUTION), and frequently serves as a Settlement Judge Pro Tem for the Marin County Superior Court. 

In addition to being an attorney, mediator, and arbitrator, Mr. Diamond is also a licensed real estate broker and real estate investor.  He is currently developing a 90-unit mixed-use multifamily project in a suburb of Portland, Oregon.


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