SOCIAL DISTANCING IMPACT ON HOUSING MARKET
In times of uncertainty, one of the best things we can do to ease our fears is to
educate ourselves with research, facts, and data. Digging into past experiences
by reviewing historical trends and understanding the peaks and valleys of
what’s come before us is one of the many ways we can confidently evaluate
any situation. With concerns of a global recession on everyone’s minds today,
it’s important to take an objective look at what has transpired over the years and
how the housing market has successfully weathered these storms.
The Market Today Is Vastly Different from 2008
We all remember 2008. This is not 2008. Today’s market conditions are far
from the time when housing was a key factor that triggered a recession.
From easy-to-access mortgages to skyrocketing home price appreciation,
a surplus of inventory, excessive equity-tapping, and more – we’re not where
we were 12 years ago. None of those factors are in play today. Rest assured,
housing is not a catalyst that could spiral us back to that time or place.
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A Recession Does Not Equal a Housing Crisis
Next, take a look at the past five recessions in U.S. history. Home values
actually appreciated in three of them. It is true that they sank by almost 20%
during the last recession, but as we’ve identified, 2008 presented different
circumstances. In the four previous recessions, home values depreciated
only once (by less than 2%). In the other three, residential real estate values
increased by 3.5%, 6.1%, and 6.6%.
We Can Be Confident About What We Know
Concerns about the global impact COVID-19 will have on the economy are
real. And they’re scary, as the health and wellness of our friends, families, and
loved ones are high on everyone’s emotional radar.
According to Bloomberg, “Several economists made clear that the extent of
the economic wreckage will depend on factors such as how long the virus
lasts, whether governments will loosen fiscal policy enough and can markets
avoid freezing up.”
That said, we can be confident that, while we don’t know the exact impact the
virus will have on the housing market, we do know that housing isn’t the driver.
The reasons we move – marriage, children, job changes, retirement, etc. –
are steadfast parts of life. As noted in a recent piece in the New York Times,
“Everyone needs someplace to live.” That won’t change.
If you have questions about what it means for your family’s home buying or
selling plans, reach out one of our real estate professionals to discuss your
needs.
ONE EXCHANGE, INFINITE POTENTIAL
Barbara L. Alexander
ABR, ABRM, GRI
Broker/Owner
- Homes of Distinction Specialist
- 2000 WVAR State President
- 2003 Region 3 RVP for NAR
- 2017 MBR Outstanding Achievement
Award of Lifetime Dedication to the
Community and Real Estate Profession
- 2019 MBOR President’s Award
- 2019 Best of Morgantown Real Estate
Company
Sincerely,
Barbara L. Alexander, Broker/Owner
balexander@howardhanna.com
304.594.0115
1.800.MOVE.2WV
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