Amid the challenges brought about by the COVID-19 pandemic, certain cities are showing signs of recovery in the housing market. As different parts of the country gradually reopen and people adjust to the normal there is an uptick, in real estate activity in some regions.
By utilizing The Real Estate Market Tracker developed by Mike Del Prete we have identified markets that are either maintaining or surpassing their COVID levels of activity. Some of these markets may come as a surprise to you.
These are the six markets that seem to be seeing a rebound after COVID 19
1. Denver, Colorado
Denvers housing market has been showing signs of recovery since hitting a point on April 23. Despite a decrease, in listings compared to June 2019 the market remains strong at the top level.
Potential setbacks; Although the region has managed to keep infection rates low concerns about virus spread in nearby Utah and Arizona have prompted the governor to warn about potential new restrictions and an increase in infection rates if residents fail to adhere to CDC guidelines.
2. Houston, Texas
Houston is also demonstrating encouraging signs of market revival. While pending sales dropped by 44% in mid April compared to 2019 figures the city quickly bounced back. By May 26 pending sales had surged by 26% above the years numbers. This early rebound has remained steady with pending sales up by 20%, as of June 21.
What might cause a delay; Situated in the county, in Texas the Houston region has experienced a surge in new COVID cases following an assertive reopening. With cases rising in mid June and local authorities elevating the alert level to severe there is a possibility that the area could undergo a second shutdown in the upcoming weeks.
In Detroit Michigan
Although slower in its recovery compared to some cities in the Midwest Detroit is showing signs of returning to normalcy. Initially experiencing an over 80% drop in listings compared to 2019 figures in May new listings have now decreased by only 9% and are on an upward trajectory.
Their strategy; Taking decisive action on along with lower population density in certain areas appear to be key factors contributing to Detroits effective response to COVID 19. While Governor Gretchen Whitmer acknowledged the developments regarding Michigans recovery she emphasized the importance of maintaining flexibility and vigilance to prevent a resurgence of infections.
In Chicago Illinois
Arguably one of the success stories the Chicago market has made notable progress towards returning to pre COVID conditions. As of June 21st Chicago reported a 21% increase in pending sales compared to the period, in 2019.
The city has made progress compared to major cities, like New York City and Los Angeles which are still facing challenges in their recovery efforts.
Washington, DC
The capital citys housing market is showing signs of returning to its strength. Despite listings being down by 7% compared to 2019 figures pending sales have increased by 6% as of June 14 indicating a promising recovery trajectory. The resilience can be attributed to government contractors, consultants, the diplomatic community and international buyers.
Potential obstacles; The combination of low interest rates and pent up demand is propelling DCs recovery. However there is a concern about the inventory potentially exacerbating if sellers do not act promptly.
Las Vegas, Nevada
Las Vegas has experienced fluctuations than cities during its path, to recovery.
Sales that are waiting to be finalized have only decreased by 6% suggesting that buyers are equally motivated, in this city as they are in places that’re also on the path to recovery. However there has been a drop of 31% in property listings compared to June 2019.
Potential hindrances; Las Vegas has witnessed a rise in COVID 19 cases after reopening partly due to an increase in tourists frequenting bars and casinos. This surge might slow down reopening plans in the weeks.
Factors behind the recovery;
Despite the reopening of businesses the ongoing impact of COVID 19 continues to shape our lives.
If the disappearance of the virus is not solely responsible for the housing markets resurgence what is driving it?
Some factors contributing to recovery in areas include;
- The shift from settings to suburban and rural areas for access to lower population density, more options for single family homes and increased outdoor spaces.
- Metropolitan regions with impacts include those involved in COVID 19 research and those with predominantly government related workforces.
- A pent up demand is propelling some markets up despite challenges, from COVID related closures.
- In todays world despite the changes brought about by the COVID 19 the need, for housing remains essential.
The real estate sector is seeing a surge in activity driven by homebuyers. The National Association of Realtors (NAR) has highlighted ten markets that offer conditions for this demographic.
These markets include;
1. Austin Round Rock, Texas
2. Phoenix Mesa Scottsdale, Arizona
3. Portland, Oregon
4. Vancouver, Washington
According to NARs Chief Economist Lawrence Yun these markets stand out due to their affordability, job opportunities and Millennial population concentration. Consequently these areas managed to retain buyers during the shutdown and are now primed for leading the market recovery.
These chosen markets were resilient during the pandemic due to fewer businesses being affected and lower unemployment rates among residents compared to metro areas with higher inventory levels hindering home sales.
In conclusion
while there are signs of recovery in city housing markets, across the country post pandemic it’s crucial to recognize that each city has its unique characteristics that shape its real estate landscape.
The data indicates that each specific market will bounce back at its speed and timing.
Nevertheless a noticeable aspect of the normal is emerging Americans are reconsidering their residence its layout and its overall size. Over the years it is highly probable that Americans will dedicate more time to working, dining and exercising at home and in their local communities—leading to an increased desire, for comfort and living space.
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