Coronavirus Homebuying Rebound Highlights Wealth Divide

June 23, 2020
Family of four looking at a house
By Ursula Page

Those impacted most by pandemic job loss, such as low-income families and minority workers, are seeing an even greater divide in the ability to own a home. Before the pandemic, low-income workers were already excluded from purchasing a home, according to Redfin, and now that goal may seem near impossible. White-collar workers with secure jobs are the ones taking advantage of dropping mortgage rates and home prices, coming out of sheltering in place with a greater thirst for homebuying. And most of them are white. 

The impact of the coronavirus shutdowns on homebuyer demand has so far been short and muted, even in some of the cities that have been the hardest-hit by unemployment during the recession. This rapid recovery in demand is a strong indication that most people who were, and are, in the market to buy a home have escaped this recession relatively unscathed.

Although the current recession officially began in February, the biggest effects began in mid-March, when most of the nation shut down due to the coronavirus. Since then, people such as tech workers and those with other white-collar office jobs that can be done remotely, who have job security and access to cash and credit have been able to continue their home searches and take advantage of low mortgage interest rates. This group is largely white. On the flip side, people who have been struggling the most during this recession—those with low-income jobs in industries like service and hospitality, groups that are made up of much more Blacks and other minorities—had largely already been priced out of the housing market even before the economy stalled. Because of this inequality across incomes and industries, the pain of the coronavirus recession is likely to be over relatively quickly for the economically privileged, even in areas where unemployment has soared.

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