4 Ways Coronavirus Could Impact Housing Long-Term

Hi Caton Team Friends, doing my part to stay educated and safe during this Shelter in Place.  I am reading as much as possible and will share articles here.  Thank you for reading! – The Caton Team

4 Ways Coronavirus Could Impact Housing Long-Term

The COVID-19 outbreak will undoubtedly have a long-lasting influence on Americans and the housing market moving forward. Housing analysts are already weighing in on what those changes could be.

In a new report, Apartment List highlights a few of the long-term changes they foresee coming from the COVID-19 pandemic:

Mobility will initially be low before spiking.

“Geographic mobility generally declines during downturns, when a lack of job opportunities catalyze fewer long-distance moves across market or housing upgrades,” the report notes. Evictions and foreclosure moratoriums will also help slow mobility. But housing analysts are predicting a spike in moves once the COVID-19 outbreak eases. “Many upgrade and downgrade moves will be postponed rather than canceled, creating a reshuffling of households throughout the recovery,” researchers note. The future wave will include those relocating for jobs, moves to be closer to family, and young adults forming their own households. Also, those who still hurt financially even after the pandemic lessens likely will need to move too.

Affordable housing is likely to become even more difficult to find.

Affordable rentals and homes for sale were already in short supply prior to the pandemic. “Fewer people moving means fewer homes available,” the report notes. “With both pandemic and policy keeping people in place, affordable units will become even more rare through the 2020 peak season.” Luxury apartment inventory, on the other hand, may be abundant.

Housing inequality could increase.

Higher earners will likely take advantage of low borrowing costs for refinancing to lower their payments as well as have more choices with the growing luxury rental inventory. On the other hand, lower-income households will likely struggle due to a sluggish economy and face increased competition for limited affordable housing. “As shelter-in-place orders cover a growing share of the nation, those who are able to work remotely are at a distinct economic advantage,” the report notes. “Unfortunately, a correlation between income and the ability to work from home reveals that the lowest earners will be hit hardest by these measures. Fifty-two percent of full-time workers who earn more than $100,000 annually say they can work from home. But only 15% of workers who earn less than $25,000 are able to work from home.”

Sight-unseen housing is likely to accelerate.

Some households may need to make a move sight unseen into their new home or apartment. “Many apartment communities are already enabling virtual tours in response to the pandemic, and many renters and owners alike may soon be evaluating their next home through a tablet screen,” the report notes. “Mainstream adoption of sight-unseen moves will bring both opportunities and challenges for the housing market.” In the rental market, sight-unseen transactions may prompt elevated levels of rental fraud, Apartment List notes.

I read this article HERE 

Got Real Estate Questions?   The Caton Team is here to help.

We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!

The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.  How can The Caton Team help you?

A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.

Call | Text | Sabrina 650.799.4333 | Susan 650.796.0654

Email |   Info@TheCatonTeam.com

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How Record Unemployment Claims Will Affect the Housing Market

As businesses across the United States have been mandated to close their doors in a desperate effort to slow the spread of COVID-19, people have been losing their jobs left and right. Now, we’re seeing the first unemployment report since the first “shelter in place” orders, and it’s far more grim than anyone had expected.

A record 3.28 million Americans filed for unemployment support in the week ending March 21—the most claims ever filed in a single week.

“Normally, when an economy goes into a recession it develops slowly over time,” says realtor.com® Chief Economist Danielle Hale. “That’s not happening this time around. … It’s pretty clear that the economy is grinding to a halt pretty suddenly.”

It will also be a tough blow to the already wobbly housing market, since those who lost their jobs are not likely to be buying a home anytime soon. Even the millions of Americans who haven’t been laid off or lost work yet are likely to hold off on a major purchase, fearing for the stability of their employment. And while ultrawealthy buyers may be insulated from the downturn, they may still balk at plunking down millions of dollars on a property they can’t even walk through. In response to this lack of demand, many sellers will likely pull their properties off the market until the crisis passes.

However, folks shouldn’t expect home prices to plunge by the double digits as they did during and after the Great Recession. In the last downturn, there were many more properties for sale, due to an overabundance of construction and mass foreclosures, than there were qualified buyers.

This time around, there is a severe shortage of housing for sale. Builders haven’t been putting up enough homes to meet demand for years. And there isn’t likely to be a huge wave of foreclosures because borrowers are in better financial shape. Plus, the federal and many state governments, along with some banks, are rolling out forbearance and other programs to help Americans who’ve lost their jobs stay in their homes. This is all likely to stabilize prices.

“Price growth will slow, and it’s possible that prices could decline” in certain markets, says Hale. “Folks expecting price declines to happen like they did during the last recession are going to be disappointed.”

The hardest-hit areas will likely be those with the highest percentage of jobs in tourism, leisure, and hospitality, the industries most affected by the novel coronavirus. But even in these areas, Hale doesn’t expect prices to go down more than 5%.

However, sales will slow down as there are simply fewer buyers and sellers in the market. Plus, it’s harder to transact remotely.

“We will see a shocking drop-off in home sales in a very short period of time,” says Hale.

They’re likely to rebound when the virus is under control, but there will almost definitely be fewer sales this year than anticipated before the pandemic.

“We don’t know when things will get back to normal,” she continues. “But when they do … we might also see a really strong bounce back.”

But Americans should expect things to get worse before they get better. Jobless claims will likely remain high until the crisis abates—and that timeline is still unclear. But the federal stimulus package expected to pass, which includes $1,200 checks to most Americans, could help to steady the markets.

“All the incoming data will also be off the chart for a few months,” Lawrence Yun, chief economist of the National Association of Realtors®, said in a statement. “The key is whether the stimulus package can reverse all these damages by the second half of the year.”

By Clare Trapasso | Mar 26, 2020

I read this article HERE  

Got Real Estate Questions?   The Caton Team is here to help.

We strive to be more than just Realtors – we are also your home resource. If you have any real estate questions, concerns, need a referral or some guidance – we are here for you. Contact us at your convenience – we are but a call, text or click away!

The Caton Team believes, in order to be successful in the San Fransisco | Peninsula | Bay Area | Silicon Valley Real Estate Market we have to think and act differently. We do this by positioning our clients in the strongest light, representing them with the utmost integrity, while strategically maneuvering through negotiations and contracts. Together we make dreams come true.  How can The Caton Team help you?

A mother and daughter-in-law team with over 35 years of combined, local Real Estate experience and knowledge – would’t you like The Caton Team to represent you? Let us know how we can be of service. Contact us any time.

Call | Text | Sabrina 650.799.4333 | Susan 650.796.0654

Email |   Info@TheCatonTeam.com

The Caton Team – Susan & Sabrina
A Family of Realtors
Effective. Efficient. Responsive.
What can we do for you?

The Caton Team Testimonials | The Caton Team Blog – The Real Estate Beat | TheCatonTeam.com | Facebook | Instagram | HomeSnap | Pintrest | LinkedIN Sabrina | LinkedIN Susan

Want Real Estate Info on the Go?  Download our FREE Real Estate App:  Mobile Real Estate by The Caton Team

Berkshire Hathaway HomeServices – Drysdale Properties

DRE # |Sabrina 01413526 | Susan 01238225 | Team 70000218 |Office 01499008

The Caton Team does not receive compensation for any posts.  Information is deemed reliable but not guaranteed. Third party information not verified.