COVID’s third wave and the housing market
Today’s HousingWire Daily episode features an interview with HousingWire Lead Analyst Logan Mohtashami. In this episode, Mohtashami discusses how the recent surge in coronavirus cases might impact the housing market this winter. In addition to sharing his thoughts on his recent article on the topic, Mohtashami gives a refresher on the five indicators that will show the housing market’s rebound from COVID-19.
For some background on the story and how COVID-19 has impacted the housing market, here’s a snippet of the article:
With COVID infection rates exploding and hospitalization rates rising as we go into the cold winter months, the risk this poses to our recovering housing market is a question that should be addressed. In a previous article, I identified infection rates during the winter months as one of the economy’s high-risk variables.
Before COVID-19 hit our shores, we were trending at 10% growth, working at cycle highs in demand. The housing heat months for the MBA purchase application data are from the second week of January to May’s first week. Typically, after May, total volumes fall as seasonality kicks in. We had double-digit growth until March 18.
Then COVID-19 hit and we had nine consecutive weeks of year-over-year declines. The fear of the virus, the stay-at-home orders, a collapsing stock market and a rising financial stress index all played a part in the market’s rapid decimation. Four weeks into the decline, the market stabilized, and the rate of decline stopped, then began to recover over the next five weeks.
We eventually turned positive on a year-over-year basis and got a true V-shape recovery, despite all the Housing Bubble Boys’ protestations calling for a crash. You may have heard whispers about a “W-shape market,” meaning a decline after the recovery. But instead, we have had 25 straight weeks of year-over-year growth, averaging over 20%.
HousingWire Daily examines the most compelling articles reported from the HousingWire newsroom. Each afternoon, we provide our listeners with a deeper look into the stories coming across our newsroom that are helping Move Markets Forward. Hosted by the HW team and produced by Alcynna Lloyd and Victoria Wickham.
HousingWire articles covered in this episode: