COVID 19’s True Impact on Real Estate — Top Texas Agent Mike Mahlstedt Shares What’s Really Happening

More than a decade ago, a young Mike Mahlstedt entered the Houston real estate market as a fledgling agent with then-Martha Turner Properties. He was optimistic but probably never imagined that in 2019, working with Compass, he would be named the second highest selling agent in the city with $100 million in residential closings. With that success under his belt, the well-dressed, lanky gent sat down with PaperCity to talk about home sales during the time of COVID-19.

This was no ordinary interview for we convened at a 9,320 square foot French contemporary manse in close-in Memorial. I had asked to meet in a dwelling that filled the needs of today’s home buyer. As one might expect of a house priced just shy of $6 million, this beauty has it all.

But first, COVID’s impact on residential real estate in the Houston market.

Obviously, everything came to a halt in March and April with mandated closures and fears of infection running at a high. Slowly, Mahlstedt says, the market began to thaw and by July sales in his high-end market were clearly on the upswing.

COVID-19 Makes Many Rethink

“It’s been interesting with COVID,” Mahlstedt says. “Real estate has been so busy for several reasons.”

“You’re stuck in your house. You’re noticing every imperfection of your house. You’re noticing how your house doesn’t work for you anymore. And there is a lot of realization, I think, with homeowners that life is short and let’s live in a house that we love.

“Or you’re in a financial position that you can no longer afford to live in the house that you are living in.”

A sad fallout of being pandemic homebound is the realization that you seriously no longer enjoy the company of your spouse or partner. Too much togetherness. There are houses on the market, Mahlstedt says, as a result of divorces caused by exactly that.

Additionally, there is the change in work habits. More and more are working from home and as that phenomenon edges into permanence, homeowners are yearning for a true home office.

“Some of my sellers have to move because they are going to be working from home and they’ve done six months of working in their master bedroom at a makeshift desk,” he says. “You can’t be working for a Fortune 500 company with an unmade behind you. This is a serious problem.”

The work from home development is causing many homeowners to rethink home design. Mahlstedt says that while open floor plans remain desirable, separate spaces, smaller spaces are growing in demand. The study (aka home office), once regarded as an ’80s design throwback, is suddenly back in favor.

The Compass agent also points to the record low interest rates as a factor in increased sales. With 30-year fixed mortgages going at 3 percent and 7- to 10-year arms at 2 percent, there has never been a better time to buy.

“The things that are priced correctly, that are good houses and that offer what the buyer is looking for whether it’s the neighborhood or price point are selling immediately,” Mahlstedt says, adding, “I still have some multiple-offer scenarios which in this market is crazy.”

What Home Buyers Are Looking For

At the top of the list, thanks to COVID-19, is outdoor space, Mahlstedt notes. This is one of the reasons he chose to meet me in the home at 722 East Friar Tuck Lane. The six-bedroom house boasts a spacious, sophisticated entertaining area that includes seating with a fireplace, a dining area, ample ceiling fans, a separate grill and bar area with bar seating, swimming pool and spa, outdoor surround sound and playground area.

Energy efficiency (considering the cost of electricity and cooling a house of this magnitude) is key to this home which holds a bank of solar panels across the roof. These provide enough power to limit electricity bills to a few hundred dollars a month — and the bill’s that high only because both homeowners drive Teslas which have to be regularly recharged.

With health concerns at the forefront of the pandemic era, this mansion wins with its UV air filtration A/C, which is billed as removing various air contaminants including viruses, germs, allergens, smoke, dust, odors, pollen and dander.

As homeowner tastes return to a more defined style of living, formal dining rooms and living rooms are regaining favor. The East Friar Tuck property has both in addition to the popular vast kitchen/great room expanse.