Economists are predicting an interesting forecast for the second half of this year. I have spoken to some people who have tenants who aren’t paying, and they believe in the next couple of months we will have a setback. July will bring corporate reporting for the second quarter and they now say we are officially in a recession that actually began in February before COVID. All of this is creating an interesting and volatile market. As the states continue to open up, there will be fewer people on unemployment. It will probably take a year or more to get it back to normal levels, but in the East Bay, the market is on an upturn.
As my manager, Elias, wrote us in an email recently: “Educating our consumers on the local market, listing inventory, buyer activity, year-over-year statistics, and truly being [customers’] trusted advocates” are important in this time.
Here are some other reasons why we most likely will NOT have a housing meltdown:
- According to the latest Wall Street Journal Economic Forecasting Survey (which polls more than 60 economists monthly), 85.3% believe a recovery will begin in the second half of 2020
- Five of the major financial institutions are also forecasting positive GDP in the second half of the year
- Four of the five expect a recovery to begin in the third quarter of 2020
- All five agree a recovery should start by the fourth quarter
- Overall, the vast majority of economists, analysts, and financial institutions are in unison, indicating an economic recovery should begin in the second half of 2020
- According to Kristin we had a housing shortage before Covid and we still have a housing shortage and that isn’t changing anytime soon.
A side effect is all the new restrictions on showing a property and how it affects the consumer. We now have to send a form stating everyone is aware of the COVID environment, make an appointment for a specific time, not touch anything, wear masks, and only have two people (plus an agent) in the house at one time.
A recent experience with a client on a new construction purchase really highlights the inconveniences. They are not allowed to meet in person, and to view the new construction, you also need an appointment. They send the document via electronic signature, however, my client was moving from out of state where they are not wearing masks and have a more open policy. He was having a hard time reading it on his phone, he was in the middle of moving to the Bay Area, and thought, “when I get there, I will just sign at the office.”
That was his expectation, but the office staff was not expecting him to sign in person because they sent it electronically. They had to give him a mask, and it became a reality of unmet expectations on both sides. The take away for me is that nothing goes a planned. We have to be more fluid. And communication is key. Expectations have to be voiced, as nothing is done how it used to be.