Covid-19 and the Housing Market

What Will America’s Housing Market Look Like After The Coronavirus Pandemic Ends? Buying or selling a home is already stressful & difficult on a good day, now lets throw in a global pandemic. Uncertainty is the housing market’s greatest future risk. No one knows how persistent the coronavirus will be, how long America’s economy will remain locked down, or what the lasting social and emotional toll on how we live, work, and interact with one another will be.

Historically low inventory and rock-bottom mortgage rates would normally set the stage for a highly competitive homebuying season. While recessions normally have only a minor effect on the housing market, the coronavirus is making life and markets anything but normal.

 

Key indicators suggested before the pandemic that there would be a lot of buyers in the market. Low unemployment, solid wage growth, and low mortgage rates are all signals of high demand. But since then, unemployment has skyrocketed, companies are inducing pay cuts to employed staff, and other signals of demand like mortgage applications and web traffic to real estate portals has dropped precipitously.

So what should I expect heading into the spring homebuying season?

New Covid-19 details every day alter what the landscape for homebuying could look like after the pandemic passes. While studies of previous pandemics suggest that home prices won’t drop all that much, the economic fallout of COVID-19 could be sweeping. While the mortgage industry could rebound quickly, the economy more broadly won’t. That would put a damper on demand and potentially lead to fewer people in the market. This would be good news for prospective buyers who would suddenly have less competition while bidding on their dream house. SUBSCRIBE to my newsletter HERE for tips on buying & selling homes.