The New York Times - USA (2020-11-15)

6 RE MB THE NEW YORK TIMES, SUNDAY, NOVEMBER 15, 2020

Real estate transactions have gone largely
digital as the pandemic has disrupted
nearly every aspect of home buying, from
house hunting to securing a mortgage, get-
ting an appraisal, notarizing documents
and signing the final closing documents.
Digital products designed to streamline
the home-buying process are not new, but
coronavirus restrictions have enabled
some of them to finally gain a foothold.
Eight months into the pandemic, many of
New York’s real estate professionals be-
lieve that some of these tech solutions may
be here to stay as buyers and sellers have
become more comfortable with virtual
transactions.
While some clients continue to prefer in-
person closings, others are giving their law-
yers power of attorney to sign the final doc-
uments for them, or they’re executing clos-
ings on virtual platforms like DocuSign.
“In my experience, the majority of people
are comfortable using DocuSign on their
phones,” said Michael J. Franco, a broker
with Compass. The pandemic has “really
forced people to rely even more heavily on
technology, and I don’t think that’ll change
going forward.”

Virtual Tours

Before the pandemic, video and 3-D tours
were embraced by some brokerages and
listing websites, but they were far from uni-
versal. By the time New York’s real estate
market reopened in June after several
months of coronavirus restrictions, most
buyers were prioritizing virtual tours be-
fore reaching out for an in-person visit.
StreetEasy, for example, included virtual
tours on its site, but 3-D tours weren’t avail-
able until April. Between the second and
third quarters of this year, the number of
sales listings with 3-D tours increased by
110 percent. And Zillow reported a 152 per-
cent increase in listings with 3-D Home
tours between this October and the same
time last year.

Mortgages

Digitization has helped speed up the lend-
ing process in recent years. But as unem-
ployment and layoffs have surged in the
pandemic, lenders have had to invest more
time in verifying potential borrowers’ em-
ployment status and history.
“The mortgage process has become a lot
more scrutinized because we’re writing
loans that have to perform or else we’ll have
a financial loss,” said Michael Bensimon, a
senior loan officer at Freedom Mortgage.

“In the environment we’re in, the fear and

concern that loans can go bad quickly is

much higher.”

To streamline work flow, Freedom Mort-

gage uses a digital verification service

called AccountChek to review the borrow-

er’s income and employment information.

Other mortgage-specific software includes

Encompass by Ellie Mae, which Mr. Ben-

simon uses to originate loan packages, and

SnapDocs, a platform that can be combined

with Encompass to facilitate interactions

and digital closings.

New systems designed to simplify the

lending process for borrowers include Bet-

ter and Morty, a mortgage broker that acts

as a middle man between the home buyer

and the lender, securing a package and then

walking the borrower through the closing

process.

Jeanne Casey, a principal at MetaProp, a

venture capital firm focused on real estate

technology, noted how QuickenLoans, one

of the largest online lenders in the country,

has helped catalyze these younger compa-

nies. “Having those digital roots is paving

the way for the digitization of the overall

mortgage industry,” she said. “We’ve seen

so much activity and focus in the space.”

Appraisals

Traditional, in-person appraisals came to a

halt this year under the state-mandated

lockdown in New York. Because appraisers

are the “eyes and ears of mortgage lenders,”

according to Jonathan Miller, of the apprais-

al firm Miller Samuel, what happens to this

industry directly affects the lending indus-

try. By the summer, as restrictions lifted,

Mr. Miller found himself doing a mixture of

in-person interior inspections, “drive-by”

exterior appraisals, and reviewing photo-

graphs of a home’s interior.

Mr. Miller sees this hybrid approach as

the new reality of his work. “Until there’s a

vaccine,” he said, “we’re going to do all

three.”

Notaries

Since March 31, an executive order by Gov.

Andrew M. Cuomo has allowed notaries in

New York to sign documents using audio-

video technology instead of signing and no-

tarizing documents in person.

Dawn Pereyo, an underwriter and past

president of the New York State Land Title

Association, says this work flow is the way

of the future. Twenty-nine states, not includ-

ing New York, have already enacted perma-

nent remote online notarization (RON) leg-

islation. “The executive order has allowed

us to start down the road of RON,” she said.

Smart Contracts

New and updated contract management

systems have helped make wet-ink docu-

ments, faxing and messenger services ob-

solete in the contract-signing process. A

platform like DocuWalk, which uses

blockchain technology to record transac-

tions through a decentralized network,

makes it a quicker, more auditable and se-

cure process.

Allen Alishahi, a broker and co-founder of

ShelterZoom, the creator of DocuWalk, said

eliminating paperwork and multiple appli-

cations is like “going from a typewriter to a

cellphone.” The software allows live remote

collaboration on its smart contracts, includ-

ing shared editing ability, tracked changes,

and both blockchain signatures and e-sig-

natures.

Similar platforms include: Dotloop, ac-

quired by Zillow in 2015, which allows users

to store, edit, share and sign digital docu-

ments; and DocuSign, a more widely used

platform that the Corcoran Group, for ex-

ample, has just rolled out to its entire com-

pany.

Pamela Liebman, president and chief ex-

ecutive of Corcoran, said it was critical to

stay on top of emerging technology in order

to stay competitive and streamline the

transaction process for agents and clients.

But she maintained that relationships still

matter even if the pandemic has forced

most of the process online.

“When it comes to important emotional

transactions like purchasing a home,” she

said, “there’s always going to remain that

in-person touch.”

J.F. PODEVIN

It’s crucial to stay on top

of emerging technology

to stay competitive.

By SYDNEY FRANKLIN

TECHNOLOGY

Virtual Transactions Have Gained a Foothold

Traditional closings, with a room full of people and stacks of documents, are becoming a distant memory.

The normal deluge of recent college gradu-
ates moving to New York in the late spring
and early summer slowed to a trickle this
year. Between broad work-from-home poli-
cies and employers reluctant to extend job
offers, many new grads elected to stay in
the childhood homes they had moved back
to in March, when college campuses shut
down.
But Kimberly Chok and Olivia Passarelli,
friends from Montclair State University in
New Jersey who majored in dance, didn’t
want to wait out the coronavirus to make a
move to the city.
“A lot of our friends are waiting until next
year, but we wanted to get a head start on
our careers,” said Ms. Passarelli, 22, who is
from Fairfield, Conn. “There isn’t really a
market for what we do where our parents
live.”
“We also wanted to take advantage of
rents being lower now, so when companies
start opening up again we can focus on audi-
tioning versus trying to find a place and get-
ting all our paperwork together,” said Ms.
Chok, also 22, who grew up near Atlantic
City, N.J.
But with much of their income coming
from freelance work — in addition to danc-
ing, Ms. Passarelli creates social media con-
tent and blogs about dance; Ms. Chok does
French translation work, sells customized
clothing on Depop and takes baking com-
missions — their rental budget was tight:
$2,200 or less for a two-bedroom.
They also had to find an apartment large
enough to take dance class at home, since
studio practice is still out of the question.
But in the neighborhoods where they ini-
tially focused their search — the Upper East
and Upper West Sides, and Williamsburg,
Brooklyn — finding a two-bedroom within
their budget was hard, let alone one with
enough space to audition and take class.
“Our general impression was that in our
budget everything was really small,” Ms.
Passarelli said. “And in the neighborhoods
where there were a lot of young people and
nightlife, things in our budget were really
not great. You either get the neighborhood
with a lot going on or you get the apart-
ment.”
Other Brooklyn neighborhoods like
Prospect Lefferts Gardens and Bedford-
Stuyvesant were more affordable, but still
too expensive for them to get sufficient
space. And while they didn’t have a press-
ing need to move by a particular date, at the
end of a fruitless four-day push in August
they were starting to think that maybe they

would have to wait to move to the city, after

all.

They were feeling so defeated about their

rental prospects after their fourth straight

day of apartment hunting that they almost

passed, sight unseen, on an apartment that

Ms. Chok’s father told them about. It be-

longed to a family friend in Dyker Heights, a

south Brooklyn neighborhood known for its

spectacular Christmas displays.

Their expectations were so low that they

didn’t bother to ask what the rent was be-

fore getting on the subway to see it that af-

ternoon. When they arrived, however, they

were amazed.

Compared with everything else they had

seen, it was huge: an entire floor of a two-

story house with a very large living room, a

recently renovated kitchen and bathroom,

ample closet space and two good-sized bed-

rooms. Perhaps best of all, the rent was the

cheapest they had encountered: $1,750 a

month, with utilities and Wi-Fi included.

It also had a piano, owned by the landlord,

who lives in the downstairs unit with his

wife — a nice perk for Ms. Chok, who plays

the piano and is focusing on musical theater

work. Ms. Passarelli does modern and con-

temporary dance, and recently started sub-

mitting videos of her work to choreography

festivals.

“We knew we weren’t going to find some-

thing below our budget that was this much

space again,” Ms. Passarelli said. They

agreed to take it on the spot and moved in on

Sept. 1.

Having the landlord downstairs has also

been nice — for handyman help, as well as

laundromat and grocery store recommen-

dations.

Ms. Chok is engaged in what she calls a

“war of hospitality” with the landlord,

which started when he brought the women

and their families fruit platters while they

were moving in. The next day, Ms. Chok car-

ried down banana muffins she had baked to

thank him. But then he left brown sugar

boba Popsicles. Ms. Chok countered with

cinnamon doughnuts. Grapes arrived in re-

turn and continue to show up. Ms. Chok is

close to admitting defeat. She baked Hal-

loween cupcakes, to which the landlord

quickly responded with more Popsicles.

And while Dyker Heights may not be

known for its nightlife, the women said that

the neighborhood felt just right for them at

this particular time.

“It’s very family-oriented and so quiet, it

doesn’t even sound like a New York City

neighborhood,” Ms. Passarelli said. “Obvi-

ously, everything is different because of the

pandemic, but it’s a nice steppingstone into

the city. It’s definitely homier than Manhat-

tan.”

RENTERS

Finding a Homey Place to Get a Foot in the Door

By KIM VELSEY

Olivia Passarelli, top left, and Kimberly Chok, college friends and trained dancers who are both

22, found an apartment in Dyker Heights, Brooklyn, that didn’t break their budget.

PHOTOGRAPHS BY KATHERINE MARKS FOR THE NEW YORK TIMES

Know a renter with an interesting story?
Email: [email protected].

NamesKimberly Chok, 22,

and Olivia Passarelli, 22

LocationDyker Heights,

Brooklyn

Rent$1,750

OccupationDancers; Ms.

Passarelli has been dancing

with a modern dance com-

pany in Hartford, Conn., and

Ms. Chok does musical the-

ater work and recently

started taking some small

acting gigs.

Taking class at home“I’ve

liked having the opportunity

to try training in different

styles,” Ms. Passarelli said.

“It’s also been really interest-

ing to take classes with peo-

ple from all over the world in

different time zones.”

Dyker Heights wasn’t

initially on their radar“But

the space is really nice, and it

works well for our situation,”

Ms. Chok said.

On living together“The

main thing that surprised us

was how well we get along,”

Ms. Chok said, adding that

they had expected a few

hiccups as they adjusted to

sharing a space. “But we get

along great.”