Covid-19 vaccines are now being rolled out in the U.S., and their introduction could soon impact on the trajectory of the housing market, experts say.
Some say that more housing inventory will arrive on the market in the coming months as the vaccination campaign gathers momentum. They believe that many would-be home sellers are delaying selling their homes until the pandemic recedes.
“As the risk of serious illness declines because more people are vaccinated, we expect to see more sellers,” realtor.com’s chief economist Hale said. That would be welcome news for home buyers who are finding limited choices. Last week, it was reported that housing inventories hit an all-time low in December as buyer demand continued to be elevated.
As well as existing homes, we should see more new homes come onto the market too. Robert Dietz, chief economist of the National Association of Home Builders, told realtor.com that builders could construct one million single-family homes and townhomes this year.
If the housing supply increases, that could relieve the pressure on prices, which have seen double-digit annual gains in recent months.
“As the economy picks back up and people are no longer afraid to be within 6 feet of one another, they’ll get new jobs, promotions, and raises,” realtor.com reported. “That will give them the cash they need to become homeowners or trade up to a larger abode.”
Experts say that as the pandemic fades away we could also see cities regain some of their lost residents. Populations in several big cities decreased during the pandemic as people moved to the suburbs or rural areas, where more space is available.
This has led to a “dramatic reset in affordability” said real estate appraiser Jonathan Miller. “It’s starting to trigger interest from younger renters who were priced out and unable to enter the market.”
Even so, the suburbs will remain popular with buyers that want more space for less money, a trend that experts don’t believe will disappear, especially with remote work set to stay.
“Single-family homes in the suburbs will clearly be favored over the condominiums in downtown, city centers,” said Lawrence Yun, chief economist of the National Association of Realtors. “People may seek out more distant suburbs.”