The New York Times, July 14, 2021, Here’s Who Will Be Left Behind in the Housing Boom
When Covid-19 first hit, those of us in the real estate industry predicted a collapse of the housing market. In just the first two months of the pandemic, 22.4 million Americans lost their jobs, while gross domestic product fell at the fastest rate in modern history in the second quarter. Instead, what unfolded was a transformation of the housing market, fueled by what I call “migration mania.”
For employees in many industries, working remotely during the pandemic effectively has untethered them from their physical offices. Historically, but even more so during the pandemic, those with higher-income jobs are the most likely to work from home, McKinsey & Company found. As a result, many of them have chosen to move from more expensive areas of the country to lower-cost metros.
This emergence of buyers relocating to lower-cost markets, paired with low interest rates, limited housing supply, investors looking to make money on the housing upswing and home shoppers caught up in the excitement, mean higher home prices. In the existing market, which represents the bulk of total home sales, prices are up 24 percent nationally from prices in May of last year, accordingto the National Association of Realtors.