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Military towns take extra hit from relocation pause

Typical spring and summer relocation seasons are on hold this year

military family

Note: This story has been updated to reflect the Pentagon’s extension on Saturday of the stop movement order to June 30.

Thousands of military families — and the real estate in towns surrounding U.S. military bases — are in limbo right now.

Each year around this time, a wave of active duty members with relocation orders start searching for houses and rentals, signing contracts and planning their summertime moves before school starts in the fall.

But this year to curtail the coronavirus spread, the Pentagon put a 60-day stop movement order in effect in March, freezing travel by all U.S. forces, civilian personnel and their families. Then on April 14, Defense Secretary Mark Esper said that order will extend past the original May 11 date. On Saturday, the Pentagon extended the order to June 30.

That means all those with orders known as permanent change of station, or PCS, have to stay where they are until the order is lifted, not knowing when they can move to that next location. Several Realtors and lenders who specialize in Department of Veterans Affairs home loans told HousingWire that this thrusts another level of unpredictability into military families and cities from California to Florida, Texas to Virginia.

“The underlying feeling is a continuation of uncertainty,” said Louise Thaxton, branch manager of Fairway Independent Mortgage in Leesville, La. near Fort Polk. Thaxton, who said VA loans make up 40% of her team’s lending, noted the ripple effect down to even moving companies tasked with transporting the military members’ households.

U.S. Transportation Command moves about 400,000 personal property shipments a year, and 40% of these moves are made during “peak season” from May 15 through August 31 each year, a spokesperson confirmed to HousingWire. The spokesperson noted that one military member may have more than one shipment and that a military member could relocate without a personal property shipment.

By those numbers, about 160,000 shipments are at stake right now.

Realtors and lenders said they have clients who have to choose between delaying their search or submitting a contract without knowing when they’ll be leaving their current home.

“What’s going to happen is they could possibly end up with two house notes,” Thaxton said.

Alanna Strei, a Realtor in San Diego who specializes in working with military and veterans, gave several examples of current clients who are stuck between places. One closed on a home in San Diego in April, with the intention of relocating in August, and then the active duty member was deployed on the USNS Comfort hospital ship to provide coronavirus relief in New York. Now that family doesn’t know when they’re moving.

Realtor Tom Torres in El Paso, Texas — home to Fort Bliss and Biggs Army Airfield — said he has three rental tenants scheduled to relocate from Texas, and they’re now on a month-to-month basis in their current housing until the stop movement order is lifted.

That unpredictability is exacerbated in areas with already-tight inventory issues, such as San Diego and the Virginia Beach area. Realtors said their military clients are actively looking for houses and having to make decisions to pause on jumping on available homes or put in an offer, unsure of when they can move.

“There’s little inventory so people are having to be aggressive with offers. It’s six, seven, eight offers the first day it’s on the market,” said Realtor Amanda Durham-Martin, team lead with Coastal VA Military Relocation Group covering the Virginia Beach and Chesapeake, Virginia areas, which have seven military bases in a 60-mile radius. “Some clients say they want to hang back and wait. We have others saying it’s good to get in before the mad rush” once the stop movement order is lifted.

Yet Realtors and lenders noted that purchase applications are still “holding the line,” as Caliber Home Loans‘ Bryan Bergjans said, because those military members know they ultimately will be moving to their next location.

“You have folks who are still executing on purchase transactions and sending the wife and kids to the new market until they get there,” said Bergjans, senior vice president of military lending for Caliber. “We’ve seen folks executing on a degree of certainty of where they’re going.”

Once the stop movement order ends, it’s unclear what the full impact will be on relocation season. Some said there will be a space-out process for relocations, while others predicted the pent-up demand for touring homes and ultimately buying them will happen in the shortened time period.

“It’s not like a whole ship gets swapped out,” Strei said. “It’s a process.”

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