I decided that a national update was more important than Vineyard sales stats right now. If you’re wondering if the country is heading into a recession due to the Coronavirus, you’ll want to watch this video.
The MORTGAGE CREDIT AVAILABILITY INDEX is a monthly measure by the Mortgage Bankers Association that gauges the level of difficulty to get a loan. The higher the index, the easier it is to get a loan; the lower the index, the harder.
Today, we don’t have enough HOMES ON THE MARKET for the number of people who want to buy them. The difference is shown here from 2011 until today, which indicates an undersupply of homes.
Now, this chart shows the difference in how people are accessing the EQUITY in their homes today, as compared to 2008. These days, consumers are treating the equity in their homes much more cautiously. And, 53.8% of homes across the country have at least 50% equity. In 2008, many homeowners owed more money than what their homes were worth.
So, what does this all mean as it relates to the type of recession we will see?
Johns Burns Consulting, a major consulting firm in the real estate industry has studied past pandemics, and they’re also saying it’s going to be a V-shape, and it’s not going to impact housing prices dramatically.
In closing, from everything that I’ve read on what is going on right now and what has happened in the past, it sounds like the real estate market is going to be ok. The distinct differences between now and the Great Recession indicates that the housing market should follow a much different path. I know that we all have been living with some major fear and anxiety over the last few months, but I am hopeful that having this information will help in some way.