New home sales and some home builder’s stocks increased in the month of May after surviving steep declines the month prior. Some home builders are even reporting gains above pre-coronavirus levels, according to BNN Bloomberg. But the economists say that the housing market isn’t out of the woods yet as credit tightens and the inventory shortage continues to rear its ugly head. For now, however, the market is enjoying the benefits of pent-up demand and low interest rates.
Stuck day and night in their homes, a surprising number of Americans are deciding the pandemic is a great time to upgrade.
That’s how it looks to Lee Whitaker, vice president of Pacesetter Homes.
After the coronavirus shutdown, the small Texas homebuilder braced for the worst. And it came: Business plunged in April.
Then in May, something unexpected happened. Sales were 30 per cent above the company’s own pre-crisis forecast for the month.
Many owners of existing homes aren’t selling, which often makes builders like Pacesetter the best source of inventory.
Mortgage rates are at record lows. And some house shoppers are saying if they have to be home more, it might as well be a bigger space.
“We’re all doing pretty well right now and we’re all, quite frankly, very surprised,” Whitaker said.