Covid-19 to severely impact USA residential market

Posted on April 17, 2020

It is highly unlikely that target of 2.7 billion square feet of new residential construction in 2020 will be met 51% of construction activity within municipalities are not currently under any legal restriction SAH/SIP restrictions with no exempt is currently applicable on 12% of projected construction 65% of area come under most affected areas designated for multifamily housing U.S. contractors heavily impacted due to supply Chain disruption in China 30% of building materials are imported from China First quarter cargo volume at US ports is projected to fall by 20% due to supply Chain disruption Unemployment rate are at record high leading to less buyer in market Mortgage rate fall due to economic uncertainty however, with no buyer in market housing market is set to fall There is no expectation of correction in housing market as currently the housing market is underbuilt In 2018 ,1.2 million households were formed, while only 860,000 units were built resulting in shortage of 340,000 units Currently House-buying power is about twice as high as the median sale price of home, implying that housing is not overvalued but is hugely impacted by Covid -19