The Coronavirus (COVID-19) outbreak has caused a dramatic change in the daily lives of New Yorkers, even as the city is one of the hardest hit in the United States.
As of the time of writing, recent statistics show that there are over 300,000 confirmed cases and 19,000 plus deaths from the disease.
In order to curb the disease’s rapid spread, the state government has issued a stay at home order, announced the closures of schools, public spaces, and non-essential businesses.
These measures to prevent city residents from contracting and spreading the disease are going to have serious consequences on the state’s economy.
A lot of sectors are already feeling the impact including the real estate, and housing market.
On March 20, Gov. Andrew Cuomo ordered statewide closures of non-essential businesses. For real estate agents and brokers, this meant an end to in-person house tours and showings.
However, this did not necessarily mean a complete pause in the buying and selling of properties in New York City, as some real estate agents began working remotely. And quickly took advantage of online platforms to conduct virtual house showings and tours.
Although the current crisis resulted in a drastic decline in the number of transactions recorded, as buyers suspended their searches and sellers pulled their properties off the market. We can conclude that all the important stakeholders are taking a step back to wait and see.
Will the novel coronavirus (COVID-19) affect house prices in New york?
If you are planning on buying or selling a property in New York, the fears of a possible economic recession due to the coronavirus might make you concerned about the housing market. Will the coronavirus affect house prices in New York City?
For us to get a reliable answer, it is important to analyze the impact of the previous economic recession on real estate, and also examine the similarities and differences between both situations.
A lot of real estate experts do not expect the widely anticipated recession to severely affect the housing market. However, they predict that it will most likely lead to a pause in transactions until consumer confidence levels rise again.
During an economic downturn, people tend to spend less due to financial constraints, but they will still need a place to stay.
The forecast of an economic recession due to coronavirus is triggering memories of the 2008 economic turmoil when housing prices plunged about 20 percent. Although, it is not all too clear that it will be the same case now.
There is no doubt that the social distancing measures are causing a disruption in economic activities, setting us towards recession. But it is not expected to be on the same levels of 2008 or any other previous recession. This can be attributed to the fact that Interest rates at near historic lows, banks have sufficient capital and the Federal Government is announcing massive stimulus packages.
In general, analysts predict a surge of activities in the New York housing market when the curve of the disease flattens and normalcy returns.