After two weeks and more than 1,500 responses to our coronavirus business impact survey, here's an update on how home builders, remodelers, and contractors are managing the crisis.
Read full results here: Week 2
How Is the Coronavirus Pandemic Affecting the Housing Industry?
Pro Builder is rounding up the latest news on the coronavirus pandemic's effects on the housing industry, including residential construction and real estate.
How the coronavirus will ultimately impact the housing market is still uncertain, but by staying informed, builders can best prepare for what lies ahead. With this chronological, curated collection of news concerning the virus, you can see how the pandemic's impact has changed over time while staying up to date with the latest coverage from reputable sources.
Week April 5
Seattle area's March home prices jumped, before coronavirus outbreak (National Mortgage News) - April 8
A deadly pandemic seemingly did little to slow down Western Washington's real estate markets in March, according to data from the Northwest Multiple Listing Service.
Weekly mortgage applications sink nearly 18% as coronavirus causes homebuyers to back away (CNBC) - April 8
Consumers are fast losing confidence in this spring housing market, given the economic upheaval from the coronavirus. Higher mortgage rates aren’t helping either.
5 Top Cities for Working From Home During the Coronavirus Pandemic (SmartAsset) - April 8
With stay-at-home orders keeping many Americans in their house, “work from home” has become a hot topic. Countless articles circulate about how to set up a home office and how to get in the zone while kids and pets play in the background. But the truth is that not many Americans can work remotely: Only one-in-three jobs can be completed at home, and they tend to skew white collar, according to a study by SmartAsset. The study rounded up the top 25 and bottom 25 work-from-home-friendly cities. See how yours stacks up.
Homebuying during a pandemic: ‘We felt like we were racing the virus.’
When Alex Ingoglia and Brooke Brady, two recently engaged law school graduates from the Midwest, first planned a trip to Atlanta in March to search for the perfect starter home, they didn’t figure they would need an escape plan. But in the age of coronavirus, even something as seemingly pedestrian as touring homes requires a little more planning.
5 indicators that will show when the housing market is rebounding from COVID-19 (HousingWire) - April 7
These are dark times. But even in dark times, we are preternaturally prepared to see the end of the tunnel.
If we are diligent, we will be able to identify the return of hope and light coming back into the American economy. While no one could truly know when we’ll see the end of the coronavirus, we can at least know what signs to look for that the housing market is on the rebound.
How Are Buyers and Sellers Feeling During the Coronavirus Pandemic? (Realtor.com) - April 7
Both buyer and seller sentiment were down in March, but sellers are particularly wary of how the coronavirus pandemic is affecting market conditions. Just over half of homeowners still think it’s a good time to put their home on the market, a nearly 30 percentage point plummet from February, according to Fannie Mae’s monthly Home Purchase Sentiment Index.
Borrower Requests to Delay Mortgage Payments Soar Nearly 2,000% (CNBC) - April 7
Requests to delay mortgage payments jumped 1,896 percent between the week of March 16 and the week of March 30. Those high percentages may be mind boggling, but the fact that many Americans are feeling the strain comes at no surprise: Applications for unemployment claims are at an all-time high, and many local economies are at a near standstill as the country works to slow coronavirus’ spread.
Which U.S. Housing Markets Are Most Vulnerable to Coronavirus Fallout? (Curbed) - April 7
According to ATTOM Data Solutions research, the coronavirus’ impact will be widespread, but it will not be equal: The Northeast’s housing markets are most at risk, while the West and Midwest will most likely sustain less damage.
Which Cities Are Most At-Risk for Coronavirus-Caused Foreclosures? (Realtor.com) - April 7
While stay-at-home orders continue and unemployment soars, the coronavirus is hitting the economy hard. As builders look around, they may be concerned that things are looking a little bit too familiar—as in 2008 familiar. But unlike the Great Recession, experts say that foreclosures will not critically impact housing markets nationwide, thanks to smarter lending and the government freezing evictions for 60 days for many mortgages. Instead, evictions and foreclosures may be more localized in cities in New Jersey or Florida that already struggle with a lack of affordable housing.
Homebuilders face confusion over Covid-19 restrictions (The Buffalo News) - April 6
Western New York homebuilders are lobbying state leaders to clarify – and possibly modify – the shutdown restrictions on the industry, freeing them to complete houses they've started or even declaring new home construction as essential.
Halt in home building has unintended health consequences, builders say (Rochester Business Journal) - April 6
In normal times, the subcontractors working for Faber Builders Inc., would have been spending the next two weeks putting the final touches on a new home for a Rochester couple.
Coronavirus concerns prompt second construction union to walk off Massachusetts jobs (Boston Herald) - April 6
Nearly 17,000 carpenters and painters are refusing to work at Massachusetts construction sites over concerns for the safety as the coronavirus pandemic escalates and calling on Gov. Charlie Baker to order a statewide shutdown.
Pa. House Republicans move to allow more businesses to open amid coronavirus outbreak (PA Post) - April 6
Republican lawmakers in Harrisburg are moving forward with plans to allow more businesses in Pennsylvania to open their doors amid the coronavirus pandemic.
6 Top Cities That May See Home-Price Growth Post-Coronavirus (National Mortgage News) - April 6
Before the coronavirus pandemic, just 1 percent of all markets could anticipate depreciation. Now, one-tenth of them may face decreasing home prices, according to Veros Real Estate Solutions. Despite this sobering reminder of how the pandemic froze what would have been a bustling spring for real estate, Veros predicts that some cities will continue to see strong growth, particularly in the West. See how the coronavirus may impact your city’s home-price growth.
3D Home Tours Steal the Show Amid Stay-At-Home Orders (Zillow) - April 6
Though potential homebuyers cannot step foot in a house, they are turning toward 3D home tours to continue their search from the comfort of their couch—or their bed, floor, or bathroom, for that matter. In the last week of March, Zillow reported an over 400 percent jump in the creation of 3D home tours from a typical week in February. And homes that have 3D tours receive 50 percent more site visitors and are saved 60 percent more than those without.
How the Coronavirus Pandemic Is Rapidly Reshaping Homebuying (Curbed) - April 6
In just over a month, the coronavirus pandemic forced realtors to find innovative ways to sell homes, including drive-by appraisals, 3D home tours, and agent-led video tours. The industry was already dipping its toes into the digital landscape, but now it must jump in head first—sink or swim. And so far, realtors and home builders are working hard to keep their head above water as the situation changes by the day.
Young Adults Headship Trends Reversed Pre-Coronavirus (NAHB) - April 6
For the first time in decades, headship rates of young adults ages 25-34 increased in 2018. This was a hopeful indicator that the troublesome trend of rising shares of young adults living with parents, relatives or sharing house with roommates finally reversed. Whether the trend reversal can be sustained through and post the coronavirus outbreak depends on the duration and magnitude of job and income losses faced by young adults.
Lenders Urge Feds for Cash to Avoid "Collapse" Amid Mortgage Payment Delays (CNBC) - April 6
The Cares Act mandates lenders allow borrowers with government-backed mortgages to delay monthly payments for at least 90 days and up to a year. In theory, deferring mortgage payments in a time of national emergency will help stave off an avalanche of foreclosures, but lenders are deeply concerned about one key detail: They still have to pay bond holders, and many do not have enough cash available.
Construction in New York Limps Forward Despite Shutdown Order (New York Times) - April 5
Development has ground to a halt across New York City. Or has it?
After initially deeming all construction workers essential employees as coronavirus inundated the city, New York State reversed course on March 27 and ordered work stopped at most construction sites until at least the end of April.
Albuquerque housing market 'rocking' — for now (National Mortgage News) - April 5
While the spread of the new coronavirus has wrought havoc all over the world, one area that hasn't been directly effected too much is Albuquerque's booming residential housing market.
At least so far.
Week of March 29
NAHB Poll: Coronavirus’ Impact on Builders Is 'More Widespread and Severe' (NAHB) - April 3
Builders in every region reported that it is taking longer to get a housing plan review or home inspection and that there is a decrease in workers’ willingness to show up to work.
6 Paycheck Protection Program Questions, Answered (ProBuilder) - April 3
Although the program is live, some builders are still unsure of some of the details of the PPP. Three builders pursuing loans outlined in the CARES Act weigh in.
Builders Uncertain But Hopeful While Pursuing Paycheck Protection Program (ProBuilder) - April 3
While the federal PPP offers a ray of hope for builders, many building companies—despite their best efforts—are being left with little choice but to lay off employees ...
How Is the Coronavirus Affecting the Housing Shortage? (Realtor.com) - April 3
Now that home building is slowing down due to lower demand and some local construction bans, the inventory shortage is expected to deepen ...
Residential Construction Adds 2,000 Jobs in March (CNBC) - April 3
Unemployment claims are at an all-time high, but here is some news that might surprise you: Residential construction actually added jobs in March. Though the pace of hiring is expected to decline as projects are delayed or cancelled, the 2,000 jobs added is a bright spot in an otherwise unrelentingly stressful time. Concerned about their workers contracting the coronavirus, some builders are pulling back, but others argue that construction is uniquely suited for social distancing due to its outdoor nature, protective gear, and spaced out workstations.
11 Charts That Show How the Coronavirus Is Impacting the Housing Market (Redfin) - April 2
The impacts of the coronavirus pandemic are rippling through to nearly every segment of the economy and the housing market is no exception. The outbreak has driven sudden changes in behavior among homebuyers and sellers in the United States, which now has more reported cases of COVID-19 than any other country in the world.
Coronavirus Casts a Dark Cloud Over the Outlook for the Spring Homebuying Season (Forbes) - April 2
The U.S. housing market got off to a bright start this year, but as the coronavirus crisis grips the country, dark clouds are hovering over the spring home buying season. And home sales will likely be much lower than had previously been expected.
Home Showings Allowed to Continue in New York, Though Confusion Remains (Forbes) - April 2
Less than two weeks after New York Governor Andrew Cuomo ordered real estate agents to stop showing properties as part of a stay-home order, the state seemed to reverse course late Wednesday and allow showings, as well as appraisal services and home inspections, to continue with social distancing.
Off-the-Charts Unemployment Stokes Fresh Fears of a Recession. Is a Housing Crash in the Cards? (Realtor.com) - April 2
An unprecedented number of Americans lost their jobs in March as the coronavirus-driven crisis continued to escalate. That's according to the latest unemployment numbers, which are inflaming fears that another recession has arrived and another housing crash may not be far behind.
Consultant Predicts a Post-Coronavirus 'Construction Tsunami' (Construction Dive) - April 2
President Donald Trump's decision this week to extend the country's social distancing guidelines until April 30 was based partly on data from statistical models that predict the peaks and plateaus of the coronavirus outbreak in the U.S.
HUD Issues Mortgage Relief for FHA Single-Family Homeowners (NAHB) - April 2
Effective April 1 for borrowers with a financial hardship that makes them unable to pay their mortgage due to the outbreak, mortgage servicers must extend deferred or reduced mortgage payment options — called forbearance — for up to six months, and must provide an additional six months of forbearance if requested by the borrower. This mandate implements provisions contained in the landmark Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which President Trump signed into law on March 27.
5 Emerging Design Trends From Life at Home (NAHB) - April 2
At a time when people stuck inside are posting videos of their dogs jumping toilet paper rolls, home builders may be wondering how they can optimize a home for, well, life at home. Before the pandemic, much of American's daily lives was seeped in a “Go, go, go,” mentality as people rushed from work to appointments, gyms, or another job. Now, many are spending days at a time within their property, and design experts say that this may shape home design to include more multifunctional levels, more storage, and more wellness technology to make sure we don’t wither away on the couch if we ever have to do this again.
How Is COVID-19 Affecting the Housing Market Weeks Into Social Distancing? (Redfin) April 2
Two extremes are coming into play during the COVID-19 pandemic: Pending sales are down 42 percent compared to last year over the last seven days, but some committed homebuyers are buying houses without even stepping foot in the home, according to Redfin. It is unclear how long the effects of coronavirus on the housing market will last, but with the push for virtual tours, falling prices, and the success of only the extremely competitive-priced homes, some of the immediate impacts are clear.
Housing Shortage Deepens as Coronavirus Pushes Inventory Down (Realtor.com) - April 2
Only time will tell how deeply the pandemic will affect housing inventory, but in most areas, it won’t help, which does not come as a surprise considering the virus is disrupting almost every U.S. industry. Despite the coronavirus' impact, however, Realtor.com says the main culprits of March’s low housing inventory are familiar to the industry: under-building, Millennials starting to buy homes, and downsizing.
Can Home Builders Lead the Way to Economic Recovery? (NAHB) - April 2
A recent NAHB estimate of the national economic impact of home building shows what builders already know: Residential and multifamily construction can help reshape an economy. According to the report, building just one single-family home generates 2.9 full-time equivalent jobs, provides an average of $86,759 in federal taxes and $42,888 local taxes, and employs a diverse set of professionals in different industries and education levels.
Americans Are Still Moving—With Hand Sanitizer, Gloves, and Thermometers (Realtor.com) - April 2
By any standards, the moving industry, like so many others right now, is substantially down in numbers, even if it is considered an essential business. More than 71% of the independent moving companies (not including the big companies) reported a decrease in business since the pandemic spread across the U.S., according to a survey of 300 firms conducted by Hire A Helper, an online market for moving services.
Is Real Estate Essential? The Department of Homeland Security Says Yes (Forbes) - April 2
The Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency published a 15-page advisory outlining “critical infrastructure” that includes many housing industry professionals. This doesn’t mean that they must work—companies can still choose to suspend business if they deem the risk of spreading coronavirus too high—but now they have the choice in states that have issued shelter-at-home orders and are following federal guidelines.
National Impact of Home Building and Remodeling: Updated Estimates (HousingEconomics.com) - April 1
This article updates NAHB’s estimates of the economic impact that residential construction has on the U.S. economy. These national estimates are designed for use when the impacts on all U.S. suppliers of goods and services to the construction industry—for example, manufacturers of building products—are of interest. The national estimates should not be used to try to analyze economic impacts confined to the state or local area where the housing is built. NAHB maintains separate estimates and models for that (see the Local Economic Impact web page).
Here’s a Look at a Post-iBuyer Housing Market (HousingWire) - April 1
As we enter into really our third full week of the new normal, I have been fascinated by the steady stream of predictions and pontificators out there.
Most of the discussions have been questioning whether the industry and markets as we knew them are ever going to rebound. Others have centered around the obvious euphoria that many agents and brokerages are exhibiting now that the iBuyers have halted iBuying.
San Diego Home Prices Were Among the Fastest Rising. What Now? (National Mortgage News) - April 1
San Diego County's home market started 2020 with prices rising more than any other West Coast market and much of the nation.
Prices in the San Diego metropolitan area had risen 5.1% in a year, as of January, the S&P CoreLogic Case-Shiller Indices reported Tuesday.
Realtors, Homebuyers Race to Find Innovative Ways to Close Amid Increasing Restrictions (Realtor.com) - April 1
Committing to a home is already one of the most stressful purchases many Americans make. Within the context of a global pandemic, homebuyers are under even more pressure as they scramble to close on a property. In order to soothe buyer fears as best they can, real estate agents are adapting at a rapid pace, signing paperwork in parking lots and finding digital ways to conduct what was a traditionally high-touch process. But even if agents hustle while taking precautionary measures, delays in appraisals and local government procedures remain as additional hurdles in an increasingly complicated affair
5 Shifting Housing Design Trends Happening Now (John Burns Real Estate Consulting) - April 1
It is too early to say if the coronavirus pandemic has sparked any new major trends in home design, but professionals do speculate that it may accelerate the growth of already up-and-coming trends. One easy example is the shift toward health and wellness, which makes sense after so many Americans are spending an increased amount of time at home. John Burns Real Estate Consulting rounded up the five trends more than 90 realtors are witnessing across 45 metro areas. See if they match what you’re seeing now, or get a sense of where design may head next.
Cities Where the Most and Fewest People Would Benefit from the COVID-19 Stimulus – 2020 Study (SmartAsset) - April 1
President Donald Trump recently signed into law the historic COVID-19 stimulus package worth around $2 trillion. It sets aside $250 billion for direct payments to individuals and families to help them deal with the economic impact of the coronavirus pandemic.
7 Tips From EEBA Builders on How to Adapt During the Coronavirus (EEBA) - March 31
If builders want to give their businesses the best chance during COVID-19, the Energy & Environmental Building Alliance says that they must embrace digital business management tools and virtual ways of communicating with clients. Although some builders will always prefer the old way of doing business, the construction and real estate industries were already shifting towards a more digital landscape: The pandemic is just accelerating the inevitable. But during this trying time, the EEBA advises that builders do not go at it alone. Instead, building each other up and turning towards organization’s knowledge can help professionals in the long run.
NAHB: Builders Must 'Do Their Part to Flatten the Curve' (NAHB) - March 31
What is considered a big win for many in the industry who are worried about the future of their projects, the Department of Homeland Security designated the construction of single-family and multifamily housing as “Essential Infrastructure Business.” But the NAHB cautions that although it is beneficial to keep builders on the job, professionals must follow coronavirus precautions to “do their part to flatten the curve.” To assist builders navigating uncharted territory, the NAHB released a Coronavirus Preparedness and Response Plan that includes safety protocol as well as downloads such as a template authorization letter that employees can use if authorities question why they are working.
Coronavirus Threatens $35 Million Redevelopment Project in Kentucky (New York Times) - March 31
The Department of Homeland Security may have declared construction an essential business, but the stay-at-home orders shuttering many restaurants and local businesses threaten the redevelopment of some of America’s poorest neighborhoods. In the Louisville Kentucky, the Portland neighborhood was gearing up for a revitalization: Mr. Holland’s Portland Investment Initiative renovated millions of dollars worth of buildings and even commissioned the neighborhood’s first multifamily development in a generation, which rang in at $3 million. But now, Mr. Holland is worried that some of the over 60 properties he bought will remain empty as the restaurants and residents he courted are facing unprecedented times.
Uncertainty for Lenders, Future Home Sales Clouds a Strong February Finish (Zillow) - March 39
February pending home sales rose 2.4 percent from January, and they were up 9.4 percent from the same time last year, continuing January’s strong preview to the spring season. But COVID-19 has shifted the path of the housing market as it has with almost every other U.S. industry’s trajectory. Though February’s pending sales were at the highest level in three years, experts believe that a sizable portion of those deals fell through, and rising delinquencies in auto and credit payment in addition to the large number of unemployment applications may spell trouble for the previously healthy mortgage delinquency rate.
5 Important Takeaways From the Economic Outlook – Spring 2020 (CIRB) - March 30
Produced by Beacon Economics and released exclusively by the CIRB (Construction Industry Research Board) Report on March 23, 2020, The Economic Outlook – Spring 2020 analyzes the impact of the coronavirus, employment trends, housing and construction, the next recession and more.
Can Builders Keep Building During Austin's Stay-at-Home Order? (NPR) - March 30
When Austin issued its stay-at-home order last week, it was kind of vague about construction. Some people were confused, and plenty of builders stayed on the job. So, can builders keep building?
No – with some exceptions.
'Safety' Work Continues for Home Building Business, as Interpretation Over Governor's Order Continues (ABC) - March 30
Sable Homes, one of the largest home builders in West Michigan, received a clarification letter from the Governor's office late last week. They're interpreting it as the work that they're doing is to "preserve the current condition of the project while the order is in effect," which, they believe, is in line with the language in Section 4(b) of the Governor's order.
Area Home Builders Say Ban on Construction Will Worsen Austin’s Housing Crisis, Force Residents to Live in Unsafe Conditions (CNBC) - March 30
Austin home builders sent a letter Monday to city and Travis County officials asking them to allow residential construction to continue while the Stay Home – Work Safe order is in place.
The order, which city and county officials signed on March 24, prohibits apartment or single-family home construction from continuing.
Homebuyers Turn to Virtual, Robot, and Solo Tours in the Age of Social Distancing (CNBC) - March 30
Spring may be heating up, but the housing market has cooled way down, thanks to the coronavirus’ spread. But some families still need to find a home, so they’re turning to the digital tools and solo tours more realtors are offering due to the pandemic. Redfin saw an almost 500 percent increase in requests for agent-led home video tours two weeks ago, and the sales of one company that sells lockboxes are rising as more homebuyers seek solo in-person home tours. Even the use of robots is seeing tremendous growth: Instead of agents taking a homebuyer directly around the house, they lead a robot that they can use to show the place and speak directly to the client at a remote location. No, this is not 2050. This is here and now, as the adoption of technology is expedited in these uncertain times.
Can You Filter COVID-19 From Indoor Air? (Code Watcher) - March 30
Builders may be wondering if there is an indoor air filtration system that could whisk the coronavirus out of a house, protecting the homeowner. Though a good filtration system could minimize the risk in theory, getting rid of a virus is more complicated than a quick filter switch. The effectiveness depends on the quality of the filter, air speed, home air diffusion, and other factors. But even if the system gets rid of a majority of the virus particles, contact with just one could infect a person. Still, improving indoor air quality still isn’t going to hurt anyone—it is just not the silver bullet.
Is All Construction Essential During the Coronavirus Pandemic? (Curbed) - March 30
New guidelines by the Department of Homeland Security deem building as an "essential business." But local rules as well as builder sentiment towards the issue vary. Some construction being essential is clearcut, including hospitals, infrastructure, and residential homes in areas hardest hit by housing inventory shortages. But others such as retail fall within a more gray area. Some builders, though they continue their work, are shifting their schedules or slowing down projects to minimize the risk for their workers, while others continue as normal with a larger focus on social distancing
Renters Stick to Moving Plans Despite Coronavirus (RENTCafe) - March 30
The coronavirus may be making homebuyers wary, but renters are still looking for their next move. In RENTCafe’s second coronavirus survey, some renters are feeling a little more anxious, but over half still plan to move as soon as they find an apartment. Besides looking for maybe something cheaper, most have not changed the kind of apartment they want or are considering adding on a roommate to lessen the cost—which might not be the best move while the country practices social distancing anyways. Read more to find out the full survey results.
9 Ways the Coronavirus May Shape Future Housing Design (Housing Design Matters) - March 30
The relationship between Americans and their homes is changing amid COVID-19. Many Americans sheltering in place stay within the same four walls for a majority of—if not all of—the day, and what was once a place to relax and spend time with family when not at work has now become the home office, the gym, and the restaurant. From these shared experiences, Housing Design Matters pulled out nine ways that home design may change in response to the pandemic, including a preference for single family over multifamily and a focus on speciality rooms such as the home office or gym.
Coronavirus Is Brewing a Mortgage Crisis (Curbed) - March 30
The financial crisis of 2008 was caused by homeowners defaulting on their mortgages en mass thanks to risky loan products that were destined to fail. The bonds those mortgages were bundled into collapsed in value as a result, and it brought the entire financial system down with it.
How the Coronavirus Will Change Closings, Home Prices and What’s on the Market (Washington Post) - March 30
We’re only getting one question recently, although it comes in many forms: How will the new coronavirus impact the real estate market?
As of this writing, buyers are still buying homes and sellers are still selling. Sam has received several contracts in a few days, although his office phone isn't ringing as much as normal. Ilyce has been talking to would-be sellers and buyers (and getting plenty of email) suggesting that people want to buy or sell, but they're nervous. So are brokers, title companies and everyone else involved in real estate transactions.
Which Metros Are Most at Risk of a Coronavirus-Caused Recession? (Realtor.com) - March 30
The United States now leads the world in the number of coronavirus cases, and the numbers continue to rise. Almost no part of American life is unaffected—and most areas will feel the recession that is likely to follow, according to real estate experts. But some areas are taking hard hits right now or are forecasted to suffer due to their links to tourism and vacation rental markets. Realtor.com found the top 10 most at-risk metros and broke down four trends playing out in them, including the expected gambling slump and second-home slowdown.
California Real Estate Sales Now Deemed 'Essential' Industry (National Mortgage News) - March 29
The real estate industry, struggling with coronavirus-linked limitations, got a boost with its sales business reclassified as an "essential" industry.
Week of March 22
A loophole for construction workers shows how arbitrary and confusing ‘stay at home’ regulations are (Market Watch) - March 28
The San Francisco construction contractor with the slate of multimillion-dollar remodeling jobs is maneuvering through the oddest weeks of his career. In early March when the first COVID-19 cases hit California, he said he’d pay workers to stay home if they showed flu symptoms. When six Bay Area counties issued stay-at-home orders on March 16 he told workers to lock up their job sites indefinitely. But when the state of California ordered people to stay home March 19, the contractor learned his 30 crew members were key to “essential infrastructure,” and thus permitted to work.
DHS Declares Residential Building 'Essential Business,' But States Still Have Own Rules (NAHB) - March 28
In the midst of this chaotic time, NAHB has news that will ease at least one worry on many builders' minds: The Department of Homeland Security (DHS) just designated construction of single-family and multifamily housing as an “Essential Infrastructure Business.” This means that most home building firms can keep their companies open when the local government closes all but “essential business.” This is especially critical because many contractors are not covered by unemployment benefits. But builders should still keep up with local rulings. Although the DHS made the guideline, states can develop their own standards for what businesses can or cannot continue during the coronavirus pandemic.
Fannie Mae, Freddie Mac to roll out new mortgage-payment deferral option for homeowners facing financial trouble (MarketWatch) - March 28
Homeowners who fall behind on their mortgage payments will soon have the ability to defer payments through a new service being offered by Fannie Mae FNMA, -2.99% and Freddie FMCC, -2.98%.
Is the Coronavirus About to Wipe Out FHA Lending? (HousingWire) - March 27
It looks like borrowers who don’t fit neatly into Fannie Mae and Freddie Mac’s lending criteria could soon be running out of options if they want to buy a house.
Over the last week, many (if not all) of the biggest lenders specializing in lending to borrowers outside the Qualified Mortgage lending box paused their activities due to uncertainty in the market.
Key Coronavirus Resources for the Housing Industry on NAHB.org (NAHB) - March 27
NAHB is committed to ensuring members have the resources necessary to navigate the coronavirus pandemic. NAHB continues to provide up-to-date economic forecasts, policy updates, business continuity, jobsite safety and communications resources for both NAHB members and HBA staff to help them navigate this current crisis.
NAHB Chief Economist Provides Economic Update on Impact of COVID-19 (NAHB) - March 27
Despite the strong start during the first two months of the year, incoming data are now showing the negative effects of the sudden stop for the economy. There were 3.3 million new jobless claims this week as the service sector shed jobs due to government-imposed social distancing related shutdowns. In the week before, there were only 282,000. This is likely the start of a wave of 5 to 10 million newly unemployed in the coming weeks.
How Is COVID-19 Impacting the Residential Construction Industry? (Principia Consultants) - March 27
Are all the numbers swirling around concerning the coronavirus pandemic stressing you out? You’re not alone. For those who are more visual learners, Principia Consulting analyzed COVID-19's impact on residential construction down to the zip code level and created a map summarizing the projected square footage of new residential construction in 2020. Before the pandemic, the country was projected to see 2.7 billion square feet of new residential construction, but with some builders facing material shortages and “shelter-in-place” orders affecting others, that number is not accurate anymore. The map notes restrictions areas are facing, and the consulting firm plans to update its analysis as the situation evolves. Find out the current projection for your area.
How Much Will It Cost to Save Americans From Losing Their Homes Amid Coronavirus? (Forbes) - March 27
This one is going to sting: The worst-case-scenario cost to save Americans from losing their homes totals $162 billion, according to the Urban Institute's Housing Finance Policy center. Even if the worst does not come to pass, the most likely scenario would still cost the country billions, ringing in at $40.5 billion to assist 14.6 million households for three months. For comparison, the worst case scenario is if 29.2 million households need assistance for six months. To analyze the impact, the center took into account the unemployment and the price of housing. And as the stimulus bill includes moratoriums on evictions and foreclosures as well as other tenant protections, these numbers are definitely ones to keep your eyes on.
Workers and Places Most Likely to Be Affected by a COVID-19 Recession – 2020 Study (SmartAsset) - March 27
In a survey of economists conducted by the University of Chicago’s Booth School of Business at the beginning of March 2020, more than half of participants expected COVID-19 to cause a major recession.
Managing a Coronavirus-Related Project Shutdown (Construction Dive) - March 27
When a hurricane or other disaster forces the closing of a jobsite, owners and contractors can be reasonably assured that, barring severe physical property damage, everyone will be back to work in short order.
However, the coronavirus pandemic has led contractors, material suppliers and other industry vendors into uncharted waters. Construction companies, for example, in Boston and other Massachusetts cities of Cambridge and Somerville and, to some degree, Pennsylvania, San Francisco, as well as Austin and Travis County, Texas, either are unsure about which projects must be closed or are looking at an indefinite moratorium.
Stay on the Jobsite (NAHB) - March 27
The safety and health of all those who work in construction remains our top priority. The industry continues to adhere to all public health guidelines set forth by the Occupational Safety and Health Administration and the Centers for Disease Control. Work on a new unfinished home site occurs primarily outdoors and does not involve going onto a location occupied by residents or a public location, and there is minimal (if any) physical or transactional contact with customers.
Financial Consultant's Advice: Track Your Coronavirus-Related Expenses (WIPFLI) - March 26
From shelter-in-place orders to flip-flopping local essential business definitions, each day provides new mentally taxing challenges. But one financial consultant advises builders to keep their eyes on the ball and track coronavirus-related expenses. Though they may not ever be reimbursed, an expense sheet will help businesses be able to more effectively gauge the impact of COVID-19. By using a ledger or a code system, builders can track the expenses and use them to guide business practices or for bidding in the future.
‘We’re going to see numbers that are shocking’: Jobless claims top 3.2 million as data on coronavirus toll rolls in (Fortune) - March 26
The first truly jaw-dropping batch of economic data is out, and the numbers are record-breaking.
On Thursday, weekly jobless claims (for the week ending March 21) came in at 3.28 million—not only a drastic uptick from the 282,000 the week prior, but an all-time record, surpassing even the Great Recession peak of 665,000 and 1982’s all-time high of 695,000.
Record-Breaking Number of Unemployment Applications Likely Understated, According to Zillow Market Update (Zillow) - March 26
In one week, 3.3 million Americans filed for unemployment, shattering previous records for applications in one week: For scope, the highest-ever weekly reading during the financial crisis was 665,000 applications in March 2009. Even more worrisome is that this influx of applications is likely to understate the actual unemployment levels, according to the Zillow Market Pulse for March 26. Many freelancers and contractors, including many in the construction industry, either do not qualify for benefits, or they do not know that they do. Find out more about how this will impact the economy and what central banks are doing to try to relieve the economic pressure.
Construction Contractors Are Working to Manage Coronavirus Risks (Zurich) - March 26
Construction crews in many cities continued to raise cranes and swing hammers as much of the world shut down to stem the spread of coronavirus. While Boston and Pennsylvania ordered a halt to most construction projects, some other cities and states designated construction as an essential or crucial sector.
There is debate over the interpretation of government guidelines, and state and city mandates could change. In the meantime, in cities where construction work has continued, it’s not business as usual.
Coronavirus Aid, Relief, and Economic Security (CARES) Act - Small Biz Highlights (Recast City) - March 26
The Senate passed the CARE bill (as of Thursday afternoon 3/26) and the House is expected to pass it tomorrow.
Here is a brief summary of parts of the Senate bill that relate to small business and unemployment. And some other parts I think are most interesting.
There are many sources out there on this bill, check those too.
How Will Record Unemployment Claims Affect The Housing Market? (Realtor.com) - March 26
A record 3.28 million Americans filed for unemployment support—in a single week. Economists say that when a recession happens, it usually builds. But because of the urgency to slow the coronavirus' spread, this time around seems to have hit all at once. The bad news for the home building industry is that people who have lost jobs are not in the market for a brand new home. But on the other hand, the conditions surrounding this downturn and the housing market’s solid foundation before this may lessen the blows. Additionally, the low inventory may have been a blessing in disguise, as experts do not expect home prices to dip too low.
Washington Issues Statewide Ban on Construction as Boston’s Moratorium Continues (Construction Dive) - March 26
Unless a Washington builders’ company is involved in essential functions such as healthcare, they will now stay home: Washington issued a statewide suspension of all nonessential construction amid the coronavirus. The rule came into effect on March 25, joining other construction bans put into place to combat the virus. Boston’s moratorium, one of the first enacted, has also been extended, despite the Massachusetts Gov. Charlie Baker saying it will disrupt critical services. The jury is out if other states will enact similar bans, but housing shortages in states such as California help builders stay essential.
Flash Survey Homebuyer Sentiment: U.S. Still Optimistic Despite Outbreak (Point 2 Homes) - March 26
To gauge homebuyers’ reaction to the outbreak and to see how they feel about the homebuying process and the current changes, we conducted a flash survey of 2,900 visitors that are searching for properties on Point2 Homes, one of the largest real estate marketplaces in North America. We asked about their short-term and long-term buying intentions, about the challenges they are encountering and also about the changes they plan to make.
Coronavirus Stimulus Package: What You Need to Know (SmartAsset) - March 26
About 2.5 weeks after the worst day in Dow history, when the index fell nearly 2,014 points, the Senate has passed the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act, a coronavirus stimulus package.
Stay-at-Home Orders Put a Hold on the Housing Market (Redfin) - March 26
In just one week, homebuying demand went from holding a 1 percent increase over last year to plunging 27 percent compared to the same time in 2019, according to Redfin. Stay-at-home orders enacted in an effort to slow down the spread of COVID-19 are having a huge impact, and Redfin says that it can be felt most dramatically in heavily impacted states such as California: Overnight, demand dropped after the state's Governor Gavin Newsom issued a stay-at-home order. But a few buyers are still committed to the purchase: Whatever their reason for needing to move immediately, they’re shopping online and signing deals in parking lots to get the closing done.
Big Banks Offer Relief to California Homeowners Affected by COVID-19 (American Banker) - March 25
Four of the five largest banks in the U.S. have agreed to let California residents skip mortgage payments for 90 days if they have lost their jobs or are struggling financially due to the coronavirus pandemic, Gov. Gavin Newsom said Wednesday.
Coronavirus Relief for Businesses (SmartAsset) - March 25
The COVID-19 pandemic has impacted every aspect of American life, including small businesses. With most Americans practicing extreme social distancing and not going out of the house except when absolutely necessary, many small businesses have a dearth of customers as they navigate the recession.
Mortgage Applications Fall Amid Coronavirus Fears (Realtor.com) - March 25
Weekly mortgage applications dropped 14.2 percent from last week. In the first year-over-year drop in three months, they were down 11.2 percent compared to last year. Considering the current coronavirus pandemic, potential homebuyers are understandably worried if this is the right time to make their next move. And with mortgage rates wildly shifting, it is hard for homeowners to get a pulse on what kind of rates they can lock in: One week, they’re near record lows, but by the next, they could be at 5 percent.
Is Building Luxury Condos Essential? (New York Times) - March 25
Construction continues around much of the country despite other industries coming to a screeching halt. It makes sense: Affordable housing is still in dire need amid the coronavirus. But in New York City, the New York Times reports that construction on even luxury condos can continue, putting workers at risk as some sites do not enforce social distancing. Some argue that luxury construction is nonessential—no one needs a luxury condo like they do groceries or a basic place to live. Local governments are now grappling with the question of what is and is not essential construction, and if they want to make that determination.
How Are Builders Being Impacted by the Coronavirus? (NAHB) - March 25
During a global pandemic may not be the best time to buy a home, and buyer traffic is reflecting that uncertainty: 81 percent of respondents said that the coronavirus has had an adverse effect on homebuyer demand, according to a NAHB online survey. A total of 46 percent said that prospective buyer traffic is impacted to a major extent, while 36 percent said it has to a minor degree. More than 300 responses flooded in between March 18 and March 23, with two-thirds of them identifying as the owner, president, or CEO of their companies. Find out what other challenges builders are facing in the full survey.
DFW home construction continues through COVID-19, but builders are wary (WFAA) - March 24
Most residential construction in Dallas-Fort Worth’s previously red-hot homebuilding market is continuing, for now, but builders and developers are taking it day by day.
That’s the new reality as coronavirus cases rise, said Justin Webb, CEO of Rockwall-based production builder Altura Homes.
Thinking Ahead: COVID-19’s Long- and Short-Term Effects on Real Estate (Forbes) - March 24
Right now, builders are confronting supply shortages and drops in demand as the coronavirus has brought many American’s daily lives to a grinding halt. But Brad Hunter, the managing director at RCLCO, says that builders must confront these immediate challenges while also thinking about what lies ahead. From new fiscal policy, the stock market’s long-term impact on consumer spending, and the virus’ possible resurgence later in the year, keeping the big picture in mind can help builders take steps today that will better prepare them for the coronavirus’ future blows. Jump to the article and find the housing section to find out how residential builders will be impacted.
How Texas Home Builders Are Weathering the Coronavirus Storm (Statesman) - March 24
Home building in Texas amid the coronavirus continues, but the going is slow: Sales are down, permitting is delayed, and the limitations on the number of workers on site is bringing some projects to a crawling pace. However, builders are making do with what they have, turning toward virtual showings and other digital tools to interact with clients. And due to the successful beginning of the new year, some Texas builders are hopeful that once we are on the other side of the pandemic, it will pick back up again when there is more economic stability.
What Builders Need to Know About the New Family Leave Law (NAHB) - March 24
In order to keep Americans healthy while also making sure businesses stay afloat, the Families First Coronavirus Response Act gives companies with fewer than 500 employees funds to give employees paid leave to care for themselves or family members during the pandemic. The law takes effect on April 1, and the U.S. Department of Labor released its first round of published guidance for employers that includes information on how to qualify, obtain exemptions, and calculate hours and wages. Find out if you qualify.
Home Builders Can Continue Working, But Prepare for Delays (Dallas Morning News) - March 24
While other businesses close, those considered essential by local governments can continue, including a majority of builders. Not only are builders essential, but some say they are also well positioned to minimize the risk of infection with their protective gear, ability to spread out around the project, and smaller teams, thanks to the labor shortage. They are also taking social distancing seriously and continuing stay-at-home policies when workers are sick. But as they wake up and arrive on site, it is not always business as usual: Material shortages and other delays are beginning to slow projects down.
Don’t blame housing — this time the home market hopes to escape the worst of the economic downturn (Dallas Morning News) - March 24
With the economy slamming on the brakes, homebuilders are potentially facing the greatest falloff in business in a decade. That’s a big concern in North Texas, which leads the country in single-family home construction and sales.
Mortgage Closings at Risk as Coronavirus Shutters Title and Recording Offices (CNBC) - March 24
Only weeks ago, thousands of borrowers were rushing to take advantage of record-low mortgage rates. Refinance applications soared over 400% annually, and homebuyers were out early and in force.
Now some of those loans are stuck in limbo as the in-person closing process can no longer be held because of the coronavirus pandemic.
Real Estate’s Spring Sales Season Slows to a Trickle (New York Times) - March 24
By the looks of things in New York City’s real estate market, spring will be a little late this year.
The spring sales season usually starts to ramp up during March. The typical number of new listings that come on the market in March is 1,780, but only 734 properties have been listed so far this month, according to UrbanDigs, a website that offers real estate data and commentary. The number of properties that have gone into contract this month, at 432, is less than half of the typical March figure, and 430 units were also taken off the market.
COVID-19 Business Impact Survey: Week 1 (Professional Builder) - March 24
Find out how builders are feeling about project disruptions and measures they're taking amid COVID-19. Nearly 1,000 home builders, remodelers, and contractors have taken the survey so far. Join your peers and take 4 minutes to complete the survey: https://coronavirussurvey.questionpro.com.
5 Ways the Housing Market Is Responding to Shifts in Consumer Behavior (Zillow) - March 23
The coronavirus is changing homebuyer behavior: Realtors are seeing less traffic, demand for virtual home tours is way up, and stay-at-home orders are closing down open houses. But most of the formal data collected so far came before the virus’ effects came into play. Zillow rounded up some of the housing industry's trends during this unprecedented time, including the violent swings in mortgage rates and how lenders are responding.
National Association of Realtors Survey Shows How Coronavirus Has Started to Impact the Real Estate Market (Forbes) - March 23
In an effort to get a sense of how the coronavirus pandemic is effecting the real estate market, the National Association of Realtors (NAR) has been conducting a series of flash surveys aimed at gauging consumer behavior.
Renters Continue the Hunt for Apartments Despite COVID-19 (RentCafe) - March 23
The coronavirus is disrupting almost every industry and corner of American life. The group seeming unchanged by it all? Renters—at least before many states issued stay-at-home orders, according to a survey by RENTCafe. A majority of respondents said that they still planned to move while just under half had no concerns in particular due to the coronavirus. If the renters did change their plans, a majority are looking for something cheaper. RENTCafe plans to rerun the survey to see if sentiment has changed after stay-at-home orders.
In Which States Can Construction Continue During Shutdown Orders? (ConstructionDive) - March 23
“Can I go to work?” is a question on a lot of Americans' minds amid COVID-19 shutdowns and “shelter-in-place” orders. The answer to that varies on where builders live and what the local government considers “essential.” If you’re in California or Illinois, feel free to lace up your boots. But if you are Pennsylvania or Masschusets, you’ll have to ride out the storm at home. Find out more about how the coronavirus is affecting construction in your city.
5 Things to Know About the New Coronavirus Paid Leave Law (Construction Dive) - March 23
U.S. small businesses and their employees are living through unprecedented times. As the COVID-19 epidemic continues, many are concerned with the day-to-day as state and local governments close or otherwise restrict business operations to halt the spread of the disease.
Coronavirus: Lockdowns Slow Bay Area Home Construction, Future Projects (Mercury News) - March 23
The coronavirus pandemic has created confusion, delays and uncertainty in housing projects around the Bay Area, despite a crushing need for new homes from an industry deemed essential to work through the regional lock-down.
How Is the Lending Industry Changing Amid COVID-19? (Forbes) - March 23
Weeks ago, digital may have seemed like the future of real estate. The future is now. After years of dipping its toes into virtual buying and selling, the housing industry is jumping in headfirst to combat the effects of the coronavirus’ shutdowns. In one of the biggest moves yet, the Federal Housing Finance Agency is directing Freddie Mac and Fannie Mae to take appraisals online to protect appraisers and homeowners from the virus. Appraisers will now be able to virtually assess properties as well as drive-by homes to check out the exteriors. Though the system is not perfect, it is a way to keep the home lending industry moving and making sure homebuyers are not left in the dark.
Video Home Tours Rocket Nearly 500% on Redfin (Redfin) - March 23
A pandemic may not be the way the housing industry thought it would enter a digital Renaissance, but necessity is the mother of invention. In just early March, Redfin debuted their virtual homebuying experience to combat the spread of the virus, and last week, the company saw a 494 percent increase in agent-led video home tours. Video tours soared from 0.2 percent of tour requests made to the current 18.9 percent. Once the world emerges on the other side of the worst of COVID-19, it’s hard to say what will happen next for the housing industry. But the CEO of Redfin says that either way, we won’t go back to the way we were before.
NAHB Advises Home Builders to Prepare for Supply Chain Disruptions (NAHB) - March 23
Builders who were Boy or Girl Scouts will be familiar with NAHB’s current advice: Be prepared. With quarantines and stay-at-home orders in place, builders may run up against disruptions in the supply chain or with contractor availability. NAHB suggests that they review contracts for escalation clauses that will account for changing material costs due to decreases in supply. Without one, builders, contractors, and suppliers may run into trouble if prices soar and they are unable to recoup the cost.
Fannie Mae, Freddie Mac Ease Appraisal, Employment Verification Standards (HousingWire) - March 23
The coronavirus pandemic may be making in-person housing appraisals risky business, but instead of bringing mortgage lending to a halt, the industry is adapting. Directed by the Federal Housing Finance Agency, Fannie Mae and Freddie Mac are relaxing the standards for property appraisals and verification of employment. Now, appraisers can use virtual sources such as property history and drive-by home visits as tools in the mortgage process. Though not ideal, the move will ensure that appraisers can continue to work remotely without risking their health.
Loose-Cannon Mortgage Rates Are Giving Homebuyers Whiplash (Realtor.com) - March 23
Even the biggest adrenaline junkie wouldn’t want to ride this coaster: Mortgage rates are racing up only to come crashing down, then hiking up higher than before. Housing experts are saying that they've never seen this kind of volatility before, and those seeking to refinance or lock in a new mortgage may feel a bit whiplash. Rates are changing by the hour some days, and one that a homebuyer sees advertised may not be the one they end up with, even if they rush to apply that day. From the start of the pandemic, the industry has seen rates near 3 percent, where experts say they were forecasted to be, all the way up to five percent.
HBI Rolls Out Virtual Learning Alternatives for Students (NAHB) - March 23
Are you a parent whose kids are going a little stir crazy? Set them up with free lessons in the trades, right at home. In an effort to continue their student outreach, HBI is granting complimentary access to online learning alternatives for local schools and training programs. Requiring no books, the programs are structured for completely online-based study. Students can learn about safety, communication, and interviewing techniques. Find out more about the programs and get a little inspiration from the future leaders of the home building industry.
California Realtors Told to Stop Home Showings, Open Houses (National Mortgage News) - March 22
The California Association of Realtors told its members Friday to stop all face-to-face sales activities including showings, listing appointments, open houses and property inspections due to coronavirus concerns.
Week of March 15
How Is the Coronavirus Affecting Home Builders? (Forbes) - March 21
Builders are not strangers to crisis. Just over a decade ago, the housing industry tanked, prompting the Great Recession. But now they face new roadblocks: supply chain disruptions, government shelter-in-place orders, and public fear sparked by the pandemic to name a few. But among it all, the builders’ confidence is still relatively high, and the industry is knee-deep in digital innovation sparked by the coronavirus’ hold on American life. This is not a situation builders want to be in, but the industry is evolving.
Will Construction Continue During Coronavirus Shutdowns? (Construction Dive) - March 20
As schools and restaurants close and only essential businesses remain open in many US cities, builders may wonder where they're required to stay at home. So far, construction workers are not barred from work in most locations, even in the hardest-hit states of New York City and California and cities with shelter-in-place orders. Still, the situation across the nation is developing, and some cities such as Boston are shutting down construction projects. As of now, most builders can continue projects, but as the pandemic continues, they should keep their eyes on their city's policy.
Which Housing Markets Will Feel COVID-19’s Effects First? (Forbes) - March 20
We may not have a crystal ball that will reveal what the coming months have in store, but by looking at the number of showings that are happening right now, builders can get a sense of COVID-19's impact and what markets are most at risk. ShowingTime, the nation’s largest online appointment center for home showings, is tracking the impact of the pandemic, and states such as Florida, New York, and California are all seeing decreased activity. Despite the alarming dip in showings in areas hit hardest by the virus, there are still a few points on our side: Early warnings will help the country prepare for the possible housing downturns and new virtual tools for showing houses could lessen the blow.
Lennar Launches Digital Homebuying to Minimize Coronavirus Risk (Forbes) - March 20
Lennar Corp., the largest home builder by revenue, just launched an entirely virtual homebuying experience amid the COVID-19 pandemic. Clients can now digitally request information online, have consultation meetings, attend virtual showings, and seal the deal on a new home. They will have the option to have a private in-home tour before closing, but everything else can be done online to minimize possible exposure to the virus. The innovation comes with a shadow over its launch, however. Just weeks before, Lennar lost one of its employees in Seattle to a coronavirus infection.
How the Refinancing Boom May Hurt the Spring Buying Season (Realtor.com) - March 20
The refinancing boom may be contributing to the new home sales bust. Homeowners rushing to refinance with the low mortgage rates are overwhelming lenders, causing delays in processing new mortgage applications and sending out appraisers to assess houses. In an effort to slow down the refinancing bonanza, lenders pushed the mortgage rates up from 3.13 percent to 4.13 percent, even as the Federal Reserve slashed federal interest rates to zero. These setbacks mixed with overall buyer concerns and lender caution may slow down the already stalling new home market. But experts say that lenders still prioritize buyers as they are more reliable customers. Lenders will continue to process new mortgage applications—just at a much slower pace.
How Will the Housing Industry Fare After COVID-19? (John Burns Real Estate) - March 19
The news is heavy these days. With cities and states with “shelter at home” orders and uncertainty around every corner, it can be hard to conceptualize the end of the pandemic. But it will come. And when it does, the housing market will stand on its feet despite the punches thrown at it this season, according to John Burns, CEO of John Burns Real Estate, and Dean Wehrli, the company’s vice president. They sat down to talk on their podcast about how the housing industry stands now and their forecast for how it will come out on the other side of the pandemic.
A Snapshot of the Housing Industry Before COVID-19, According to Redfin (Redfin) - March 19
Stronger than ever, the U.S. housing market was full-speed ahead going into what was forecasted to be a spring buying bonanza. Home-sale prices increased 6.6 percent year-over-year according to Redfin, construction was up, and low interest rates were poised to entice new homebuyers into the housing market. But then the coronavirus hit the United States, and American life changed in the span of weeks. The housing market slowdown is especially hard for the industry because before this, builders were feeling confident as the market finally picked up after a rocky decade post-Great Recession. But experts at Redfin say that looking back at the start of 2020 might remind the industry where the housing market may return to once the pandemic passes.
How Is COVID-19 Impacting the Housing Market Right Now? (Realtor.com) - March 19
As businesses close and many Americans hunker down at home amid COVID-19, fears of how long this may last and if a recession will follow are on the minds of many. With public concern sky high, builders are no doubt wondering how the virus is impacting the housing industry. According to a Realtor.com survey that more than 3,000 realtors took at the start of the week, the virus’ disruption substantial. Nearly 28 percent of realtors are seeing fewer homes on the market due to the coronavirus, 40 percent reported that open houses are on hold, and 16 percent have had clients take their listing off the market--up from a mere three percent the week before.
NAHB Advice to Home Builders: Evaluate Your Contracts (NAHB) - March 19
As the coronavirus disrupts supply chains and some cities suspend construction, the National Association of Home Builders recommends evaluating business contracts for clauses that account for delays caused by unforeseen circumstances. Clauses may allow for builders to have more time to complete a project, or it may allow the client to terminate the contract. In order to determine the best path forward in the event of a significant delay, builders must review their specific contract to see what steps they must take, such as notifying the client of the delay, and if the coronavirus fits under the kinds of events covered by the contract. The country may be in unprecedented times, but keeping tabs on contracts can help builders avoid an even messier situation.
Home Sales Could Fall 35 Percent This Spring Amid Coronavirus Pandemic (CNBC) - March 19
The coronavirus pandemic cancelled spring break vacations, shut down spring semesters, and now it seems that it will force the spring buying season back into hibernation. As American’s attention understandably turns to the swirling economic uncertainty, health concerns, and unemployment fears, home sales could fall by 35 percent annually this spring, according to a new analysis by Capital Economics. Though home prices are not expected to fall thanks to low housing inventory, experts still expect a slow buying season as homebuyer and seller caution increases.
Why Redfin Is Suspending Its iBuying Program (HousingWire) - March 18
Redfin announced that it will halt its iBuying arm, RedfinNow, due to the housing market’s uncertain direction amid the coronavirus pandemic. This news comes after the company banned open houses to help slow the spread of the virus. Because of decreasing buyer demand and ambiguous market conditions due to COVID-19, Redfin says that it cannot give accurate home value estimates, and therefore cannot make instant offers on properties. The company stresses that it is not ending RedfinNow entirely, but instead is putting it on pause until there is a clear path forward.
Apartment Search Traffic Plummets As Americans Prepare for COVID-19 (RENTCafe) - March 18
The search “apartments near me” took a nosedive as the spread of the coronavirus disrupts almost every aspect of American life. Now, instead of hunting for the next big move, people are searching for how to disinfect their homes, set up a home office, or create a new at-home workout routine. This switch in search topics related to housing reflects the overall shift in priorities this past week as businesses shut down offices, restaurants and bars go to take-out only, and students move to e-learning.
How Disruptive Will the COVID-19 Pandemic Be to Real Estate? (Point 2 Homes) - March 18
Common sense would say that real estate may not be the first thing on Americans’ minds during a pandemic, and how people are searching online is backing that up, according to Point 2 Homes. Google Trends shows a marked dip in searches related to “real estate,” “houses for sale,” and “condos for sale.” Additionally, traffic to Point 2 Homes' website is also down, falling 35 percent in just one week. And as sellers stop open houses and move to virtual showings, the industry will continue to change. Point 2 Homes has rounded up charts to show the change in search volume as well as professional opinions on the outbreak.
Coronavirus' Hold on Housing Market Nearly Nationwide (Redfin) - March 18
Before the spread of the coronavirus, all the housing market's stars were aligned: Builders were confident, demand high, interest rates low, and construction was ramping up as the housing industry prepared for its best season in a long time. No one expected a global pandemic to pull the rug from under not just the housing industry, but the entire nation. Now, after cautious warnings that the housing market may slow down despite holding steady, the effects of the coronavirus’ spread are showing weakened buyer demand as it dropped from 27 percent growth in the beginning of 2020 to one percent in the past week.
How the Coronavirus May Affect OSHA Compliance on Building Sites (NAHB) - March 18
The coronavirus is disrupting American life as we know it, and the National Association of Home Builders is watching out for two ways OSHA compliance may be affected: masks and injury and illness reporting. Despite health organizations urging those who are not ill to stop stockpiling masks, N95 masks, the unofficial symbol of the coronavirus pandemic, have become scarce. The NAHB warns that builders may have a harder time finding the masks, which are integral to protecting against silica dust, and recommends that builders either use a different mask model or try to reduce the amount of dust created in the first place. And though it is unclear how reporting instances of the coronavirus will go, NAHB says that builders should keep their eye on the changing policy surrounding the virus.
February Housing Starts: A Snapshot in Time Before the Coronavirus Storm (Zillow) - March 18
February housing statistics will provide a benchmark to see how the virus’ spread impacts the industry as the country moves forward with quarantines, mandated closings, and social distancing initiatives. Last month ended with less than 1.6 million housing starts, which is down from the previous month but nearly 40 percent up from 2019. Although the spring buying season will most likely pull back from the expected boom, Zillow’s monthly report notes that due to the inventory shortage and low rates, builders may still have opportunities once the pandemic passes.
COVID-19 May Curb Spring Buying Boom Despite Low Rates (Realtor.com) - March 18
We were all set to usher in a successful spring homebuying season with builder confidence soaring, buyer demand strong, and interest rates low. But as they say, the only constant is change, and this shift in direction for the housing market does not appear to be working in the housing industry’s favor—even with rock-bottom mortgage rates. The social disruption due to the coronavirus is a necessary step to try and slow the spread of the virus so the healthcare facilities can keep up, but experts believe that the fallout from public fear and social distancing will put a damper on the upcoming buying boom we had been hoping to see. Still, they say the housing market will not crash as it did in the Great Recession as the market now has high demand and low inventory. https://www.probuilder.com/covid-19-may-curb-spring-buying-boom-despite-low-rates
Opinion: How Coronavirus Is Already Threatening the Housing Market (MarketWatch) - March 18
As the coronavirus pandemic threatens financial markets and sends the U.S. economy into a potential recession, those of us who lead mortgage firms must take swift action to prepare for the worst. The last time the financial markets suffered such a precipitous drop was during the 2008 Great Financial Crisis.
Majority of business leaders expect a hit from coronavirus, survey finds. Here’s how they’re fighting it (CNBC) - March 18
CEOs across the globe are coming to terms with the reality that business will be anything but normal over the coming months as the impact of the coronavirus pandemic continues to escalate.
But while revenues are set to suffer a short-term hit, the majority of leaders remain confident that their companies will be back on solid footing within the year, according to a new study on the business impact of the outbreak of COVID-19, the disease’s formal name.
Redfin, Re/Max and other brokerage firms cancel open houses as coronavirus hits the real-estate industry (MarketWatch) - March 18
Brokerage firms are cancelling open houses and promoting virtual tours of homes as buyers and sellers alike become concerned about contracting the novel coronavirus through the real-estate process.
National real estate brokerage Redfin RDFN, -15.486% is cancelling future open houses, the company announced Monday. The company is also limiting in-person tours of its homes to two customers per tour.
Majority of Homebuyers Say Stock Market Volatility Has Not Impacted Ability to Buy Home (Redfin) - March 17
The coronavirus has altered America in ways people have never seen before: Entire school systems have closed with no end date in sight, restaurants are going to carry-out only, and family members must virtually visit the sick and elderly to prevent high-risk demographics from contracting the virus. Even the housing industry is changing as it shifts to virtual showings and braces for the hit to the spring buying season. But for now, 70 percent of homebuyers say that the stock market volatility has not yet impacted their ability to afford a down payment, according to a Redfin survey in early March. Most buyers affected are those looking in the luxury market and those who planned to sell stocks to afford a home.
How Coronavirus Has Affected Real Estate (New York Times) - March 17
The coronavirus has changed the way we live our daily lives and it has upended countless business sectors, including the New York real estate market. Brokers, buyers and sellers are struggling mightily to do business when it’s anything but business as usual. Open houses are being eliminated, or at least circumscribed; brokers are doing FaceTime apartment tours for clients who are worried about being out. And, in the suburbs, they’re scrambling to find short term rentals for clients who feel the walls and everything else closing in on them in the city.
Remote Closings, Virtual Board Interviews Keep Real Estate Industry Moving In New York City (Forbes) - March 17
On Monday, as New York City grappled with school and restaurant shutdowns in response to the COVID-19 pandemic, real estate attorney Steven Matz embarked on uncharted territory for real estate professionals in the five boroughs — a remote closing.
Can't Find Toilet Paper? It's No Wonder the Bidet Biz Is Booming
As the novel coronavirus spreads germs and fear worldwide, many (either voluntarily or by government decree) are hunkering down at home with a stockpile of household items. Among the most prized? Toilet paper, which, rather inexplicably, has all but disappeared from store shelves.
Sorry, Millennials: A Coronavirus-Induced Recession Won’t Help You Buy a H ouse (Curbed) - March 17
The 2008 financial crisis brought the global economy to its knees and sent American home prices into freefall. For anyone who managed to hang on to their job, savings, and credit score, the aftermath of the crisis was a prime opportunity to buy a house at a bargain price.
Home Builder Sentiment Falls, as Coronavirus Begins to Factor in (CNBC) - March 17
A monthly measure of homebuilder sentiment only partially reflected the escalating economic effects of the coronavirus. Sentiment fell 2 points to 72 in March, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
Coronavirus - What Construction Workers Need to Know (Matt Risinger) - March 16
In this Special Edition of the Build Show we are discussing job site working precautions related to COVID-19 (Corona Virus). My wife is an Internal Medicine Physician and as we have been discussing this outbreak over the past week, she made some excellent points so I've asked her to join me on this video with specific construction work related procedures to reduce risk of infection and the spread of this virus.
Will Mortgage Rates Remain Low Amid COVID-19? (New York Times) - March 17
With quarantines, school closures, and calls for increased social distancing across the country, we cannot seem to catch a break this week. For homeowners looking to refinance, at least mortgage rates are low. But will they stay there? Just last week, some homeowners rushed to refinance only to find the 30-year, fixed-rate mortgage jump unexpectedly, as experts forecasted rates to continue to drop, not rise, amid growing concerns surrounding the coronavirus. Still, economists say that those looking to lock in low rates will not suddenly wake up to sky-high rates. Though they may bounce around the current levels, the rates will remain low for the time being.
Paid sick leave: Who gets it during the coronavirus outbreak (Washington Post) - March 17
There’s growing consensus that Americans need to stay home to help prevent the spread of covid-19, especially if they feel sick or have a suspected or confirmed case of the coronavirus that causes it. The health of the nation comes first, experts say, but will workers still get paid?
A complete guide to coronavirus charts: Be informed, not terrified (Fast Company) - March 17
We are in the middle of an information overload about the novel coronavirus, with hourly case updates and endless streams of information. How do you find the signal in the noise? What information do you need to make decisions in the face of this pandemic?
Buyers and Sellers Reverse Expectations for Home Prices During the Next Recession (Redfin) - March 16
Just three months earlier, half of homebuyers and sellers surveyed by Redfin expected home prices to rise during the next recession. Then the coronavirus’ spread began, and now nearly one-third of homebuyers and sellers say they believe that home prices will decline. Still, economists point to previous recessions as examples of where home prices rose, save for the Great Recession started by the housing crash. But when everything is changing around us, it is no surprise that the coronavirus' spread is impacting into American’s perceptions of the housing market.
HA braces for virus, warns of potential bottlenecks as demand grows (National Mortgage News) - March 16
The Federal Housing Administration is making coronavirus adjustments while warning of possible delays as the industry anticipates a new wave of borrowing due to the Federal Reserve's latest policy measures.
Social distancing likely to affect physical mortgage closings (National Mortgage News) - March 16
Even as mortgage application volumes climb, the physical ability for those loans to close could be in question as authorities call for social distancing to prevent the spread of Covid-19.
While electronic closings are a possible solution, they run into state law impediments such as the permissibility of remote notaries.
Confronting COVID-19: Social Distancing, Buildings, and Lessons from Asia (Urban Land) - March 16
Communities around the world are racing to control the spread of the novel coronavirus and the disease that it causes, COVID-19. Increasingly, that means implementing aggressive social distancing measures, which can inhibit the spread of the virus and flatten the transmission curve.
Half of U.S. Workers Expect COVID-19 to Harm Workplace (Gallup) - March 16
As U.S. employers rapidly adapt their workplaces to avoid further community spread of COVID-19, American workers offer a mixed assessment of how the disease will affect their place of work. Half say COVID-19 will have a negative effect on their company or workplace -- either very (18%) or somewhat negative (32%) -- while 50% say it will not negatively affect their workplace.
COVID-19 and Real Estate: With Caution, the Business of Selling Homes Goes On (Forbes) - March 16
In residential real estate, some buyers always need to buy and some sellers always need to sell. Amid escalating concerns about the spread of COVID-19, the New York real estate business is pushing the pause button, but not the stop button.
Fed Slashes Rates to Near-Zero and Unveils Sweeping Program to Aid Economy (New York Times) - March 15
With the fast-spreading coronavirus posing a dire threat to economic growth, the Federal Reserve on Sunday night took the dramatic step of slashing interest rates to near-zero and unveiled a sweeping set of programs in an effort to backstop the United States economy.
In addition to cutting its benchmark interest rate by a full percentage point, returning it to a range of 0 to 0.25 percent, the Fed said it would inject huge sums into the economy by snapping up at least $500 billion of Treasury securities and at least $200 billion of mortgage-backed debt 'over coming months.'
Fed Moves to Bolster Housing Markets (National Association of Home Builders) - March 15
As more segments of the economy shut down over the weekend in an effort to slow the spread of coronavirus, the Federal Reserve unleashed a round of monetary policy stimulus, including the purchase of $200 billion in mortgage-backed securities and $500 billion of Treasuries.
Among the other moves was a cut in the federal funds rate to a top rate of 0.25%, reducing the discount rate from 1.25% to 0.25%, and boosting liquidity by slashing the reserved requirement for banks.
Week of March 8
6 Ways the Coronavirus Outbreak Will Affect Construction (Construction Drive) - March 13
Three words stand out to construction attorney Steve Lesser when thinking about how U.S. contractors should react to the negative effects of the global coronavirus pandemic: Wait and see.
Lesser, the chair of Becker’s construction law practice, said he thinks the best thing for contractors to do is nothing at all, as the fallout from the effects of COVID-19 on the U.S. is far from complete and no one can predict its full impact.
Advice for Home Builders During the COVID-19 Pandemic (Home Builders Network) - March 13
Al Trellis, president of Home Builders Network, gives his suggestions for how builders can respond to the pandemic and an example of a preliminary policy by a mid-sized home builder.
“Several of our clients have reached out to us about our opinion regarding the Coronavirus. Here are our thoughts:
1. The full impact of the Coronavirus pandemic has yet to be determined. While the public’s anxiety is sky high, the facts are far from clear. The percentage of people who will be infected, the true fatality rate, and even the actual length of the contagion period are all still uncertain. The best strategy for now is to listen to reliable information sources (CDC, WHO), and, based on the facts as they become clearer, create policies and procedures for your employees and trade partners regarding work conditions and personal safety (attached is an example of such a policy). It is important that senior company personnel set a good example and remain calm and objective. As much as we all want to “do something”, at the moment we really need more clarity as the situation develops."
If the Pandemic Triggers a Recession, What Will Happen to Home Sales? (Realtor.com) - March 13
It wasn’t a trade war or the fallout from Brexit that ended the longest bull run in the history of the U.S. stock market: It was the unforeseen impact of COVID-19. Even though the coronavirus has cancelled major sporting events, flights, and shutdown schools, bars, and restaurants, would a downturn, if there is one, caused by this pandemic, be worse than the Great Recession?
11 Ways to Adapt to Short-Term Disruptions in Consumer Behavior (Do You Convert) - March 13
The dip in the stock market and shifts in consumer behavior may be alarming, but instead of panicking, one marketing expert in the housing industry says to adapt to these short term disturbances caused by COVID-19’s spread. Thais Cuffy says that the volatile market is a reasonable response to the pandemic, and that by watching how consumers want to interact during this stressful time can give clues on best practices, such as offering virtual appointments or upping video content so potential buyers can see homes without stepping foot inside. By keeping an eye on consumers, builders and realtors can better navigate the housing market's changing landscape.
How Will the Coronavirus Affect Spring Buying Season? (Realtor.com) - March 13
The spring buying season was cruising toward a robust performance due to the lowest mortgage rates on record and a strong job market, but the economic volatility and caution surrounding the coronavirus pandemic may dampen the forecasted success. The National Association of Realtors expects a 10 percent term drop, a complete turnaround from the anticipated growth before the virus started its worldwide spread. Though the housing market so far has been less affected than other industries, the anxiety surrounding the pandemic is already causing buyers to pull back: 11 percent of realtors reported lower homebuyer traffic in an NAR survey.
Mortgage rates jump back up to January high, as coronavirus fears put chill on spring housing market (CNBC) - March 13
After falling to a record low just two weeks ago, mortgage rates are surging higher again. This as real estate agents try to deal with a new normal in what was supposed to be a busy spring housing market.
The average rate on the 30-year fixed fell to 3.13% on March 2, the lowest ever recorded by Mortgage News Daily. That rate is now back up around 3.65%, as yields on mortgage bonds rise and lenders keep rates higher as a way to handle overwhelming refinance demand.
Mortgage markets returning to normal after freezing up during a volatile week (Denver Post) - March 13
U.S. mortgage rates spiked earlier this week and the entire market clogged up on Thursday, but by Friday things were flowing again after the Federal Reserve stepped in with the financial equivalent of a giant toilet plunger.
Coronavirus dampens homebuyer interest: NAR (CNBC) - March 13
CNBC’s Kelly Evans discusses the challenges the housing market faces amid the coronavirus pandemic with Diana Olick.
"This weekend will be a good gauge of how buyers are reacting. But they lose that great benefit. Mortgage rates hit a record low two weeks ago, but moved sharply higher in the last two days now back up to January levels."
Buying a Home During a Pandemic (New York Times) - March 13
Whatever it is that is happening now hasn’t hit the housing market yet, but it probably will. Stocks have fallen, entire industries are putting themselves on pause and all manner of small businesses are taking hits.
Americans Are Split Over Coronavirus’ Impact on the Housing Market (Redfin) - March 13
About 40% of Americans anticipate that the recent spread of the novel coronavirus, also known as COVID-19, will have a negative effect on the housing market, according to a new survey conducted by Redfin.
Mortgage Rates Rise, Reacting to Refinance Rush (The Washington Post) - March 13
As measures to slow the spread of the coronavirus intensify and investors flee the stock market, one might assume that mortgage rates would plunge further. But on Thursday, the 30-year loan mortgage rate defied expectations, rising to 3.36 percent from a previous 3.39 percent. The move comes as a deterrent to refinancers as lenders struggle to keep up with the rates bonanza: Refinancing applications climbed 79 percent from last week, which spurred the Mortgage Bankers Association to double its previous volume forecast for 2020. But as the pandemic puts pressures on the travel and tourism industries and continues to rock the market, the future path of rates is uncertain.
How the Coronavirus Is Changing the Way We Sell (Realtor.com) - March 12
Shut the front door: Open houses are on hold. In Seattle, ground zero for the U.S. coronavirus outbreaks, home sellers are turning to virtual showings to sell their houses, according to Realtor.com. Or, if they do have an open house, it is a more solemn affair full of disinfectant wipes, hand sanitizer, and potential buyers walking as if they have an invisible barrier around them. Though the housing market remains stable among the outbreak, cities impacted by the virus are seeing a dip in demand—even as interest rates are lower than ever.
New York Real Estate Hit by Coronavirus, Market Decline (CNBC) - March 12
Plunging stocks and coronavirus fears are starting to hit the New York City real estate market.
Forty-four open houses had zero traffic last weekend, according to Fritz Frigan, executive director of sales and leasing at the New York residential real estate brokerage Halstead. Those 44 empty open houses represented 13% of all open houses, up from 9% two weeks earlier.
Housing Demand Holding Steady Amid Coronavirus (Redfin) - March 12
Though the long-term effects of the coronavirus on the housing market are yet to be determined, Redfin says that housing demand on its site is holding steady with healthy growth. Though demand has pulled back slightly as the stock market dips, low interest rates seem to be keeping some buyers interested, according to a Redfin survey. But demand in Seattle and San Francisco has dropped, an important detail for what may happen in cities where the virus spreads next. For now, however, the demand in the rest of the country seems to be continuing its growth into the spring buying season.
Mortgage Rates Driven to Historic Lows by the Coronavirus Amp Up Homebuyer Purchasing Power (Redfin) - March 11
A dramatic drop in mortgage interest rates, driven by coronavirus fears, has given homebuyers a big boost in purchasing power in recent weeks. At the current mortgage interest rate of 3.2%, a homebuyer with a $2,500 monthly mortgage budget could afford to purchase a home priced $51,250 higher than in March of 2019 when rates were 4.4%.
Week of March 1
Can the housing market withstand the coronavirus? (HousingWire) - March 3
Logan Mohtashami suggests, “...The housing market is strong enough to handle a short term hit to global demand.
Where do we go from here?
For now, I recommend focusing on the positives, rather than falling prey to the fantasies of gold bugs and survivalists. The next six months can produce some terrible economic headlines, but don’t ever forget we are a strong, proud, hard-working people and we won’t take this lying down.
Here are three things we can do as a nation in response to this short-term, albeit, horrific virus outbreak:
- Institute an instant payroll tax cut to help prepare families for a possible economic downturn and to assist with any extra costs associated with virus prevention.
- Provide an open-ended emergency assistance fund for businesses, self-employed workers, local government agencies and individuals who have incurred costs or financial hardship due to the spread of the virus or containment measures.
- Government funding to pay for all COVID-19 related medical bills including quarantine costs. Free tests for those with symptoms and free vaccines when they become available.”
How to Coronavirus-Proof Your Home—and Your Life (Realtor.com) - March 2
In just a few weeks, the new coronavirus has made serious inroads into American communities, even as its global death toll grows. Many health experts are saying that the opportunity to contain the spread of the virus is over; now, it's time to do what we can to mitigate what the World Health Organization is now deeming a pandemic.
Impact of the Coronavirus (COVID-19) Outbreak on U.S. Real Estate Markets (RCLCO) - March 2
In this issue of the Advisory we look at the likely impacts of the COVID-19 outbreak on U.S. real estate markets overall and by sector. The Centers for Disease Control and Prevention (CDC) expects the outbreak to continue spreading in the U.S. and says it’s likely to become a pandemic. While we’re optimistic that the U.S. economy and real estate markets will weather this crisis as they have many others, we also believe it’s important to be prepared for all possibilities.