Real Estate Market Crash Unlikely, Experts Say
Economists are calling the pandemic-induced recession unique in several ways. Here’s how analysts expect the health crisis to change the real estate market.
August 26, 2020 | Roxana Baiceanu | Commercial Property Executive
As the COVID-19 pandemic made its way into the U.S. early this spring, wreaking havoc on the health-care system and almost paralyzing the entire economy, most industry specialists began asking themselves if 2020 will bring a real estate market crash. Although predictions made in March and April were grim, strong voices foreseeing a market crash this year are now significantly fewer.
Meanwhile, as economists started to rule out a housing bubble, concerns regarding a severe financial crisis intensified due to the Federal Reserve’s massive infusion of capital into the private sector. The yield spread figure going negative for a few months in mid-2019 was one of the early indicators of the upcoming market volatility, while the Urban Land Institute’s economic report published in May predicted an unusually low treasury rate for the next two years, averaging 0.8 percent in 2020.
