New York State’s Official Guidance on “Essential” Real Estate Services

The state has released an official confirmation that real estate is considered an “essential business.” But ambiguity remains about what in-person contact is permissible.

In a guidance issued Thursday, the Empire State Development agency said real estate services must be conducted remotely for all transactions, “including but not limited to title searches, appraisals, permitting, inspections, and the recordation, legal, financial and other services necessary to complete a transfer of real property.”

The guidance states that “any services and parts therein may be conducted in-person only to the extent legally necessary and in accordance with appropriate social distancing and cleaning/disinfecting protocols.” It also reaffirmed that brokerage and branch offices should remain closed to the general public.

The document offers some clarity to the industry after a choppy week of announcements from the agency, which is tasked with determining which businesses are “essential” during the pandemic.

The reclassification was first announced last Wednesday by the New York State Association of Realtors in an email-blast to members. The Real Deal confirmed it with Empire State Development that evening, and was informed that residential and commercial showings, appraisals and some back-office work were considered essential — though virtual and remote options were encouraged.

The following day, the agency clarified that showings could only be conducted virtually, and “essential business” was by no means business as usual. “Brokers can only transact business in their offices or show properties virtually, and anything else is off limits,” spokesperson Matthew Gorton said in a statement last Thursday.

Though the latest guidance forbids brokerages from opening their offices to the general public, it still leaves room for interpretation about what in-person activity could be considered “legally necessary.”

In an email Thursday, NYSAR encouraged its members to interpret the allowance “extremely narrowly” and “not [to] view it as a loophole permitting broader in-person activities.”

James Whelan, the president of the Real Estate Board of New York, said in a statement that “the safety and health of New Yorkers is paramount,” and that the “agent community should stay home and do as much work as possible virtually and not engage in any in-person real estate activities such as going to the office, open houses, walk-throughs or showings.”

The restrictions built into real estate’s guidance will likely be welcomed by many brokers who were concerned after the initial announcement that in-person home showings would resume.

Some were also concerned about whether the reclassification would jeopardize their unemployment claims under the federal government’s “pandemic unemployment assistance” program, which extends to independent contractors.

A spokesperson for the state Department of Labor clarified to TRD this week that, “if an independent contractor, whether deemed an essential business or not, is affected by Covid-19, and the independent contractor is not working as a result of Covid-19, they can file for unemployment.”

Write to Sylvia Varnham O’Regan at so@therealdeal.com