We’re getting asked a lot of questions lately.
When is the economy going to recover?
The American economy right now is like someone had a pause button, right? It’s like, we’re on stop. We’re on hold. Very different from 2008. The 2008 crash came fast and we had to rebuild the housing and mortgage market. It was like a tsunami came in and wiped out the entire housing market very, very quickly. Now we’re at a halt but eventually we’ll be going back to work, so it’s a different type of recovery.
Golden Sachs, J.P. Morgan and Morgan Stanley are calling for a rapid V type of recovery. John Burns Consulting, a major consulting firm in the real estate industry, has studied past pandemics and they state, “Historical analysis show that pandemics are usually V-shaped, sharp recessions that recover quickly enough to provide little damage to home prices and some very cutting edge search engine analysis by our information management teams shows the current slowdown is playing out similarly thus far.”
It’s worth looking back at history to place the potential impact of COVID-19 empirically. In fact, V-shapes monopolize the empirical landscape of prior shocks, including epidemics, such as SARS known as the 1968 H3N2 Hong Kong Flu and the 1958 H2N2, known as the Asian Flu.
So in past pandemics, we saw V-shaped patterns. So yes, it’s crazy wild right now. Everyone’s been delayed and put on pause, so experts are anticipating once the pandemic restrictions actually go back and people go back to work, they’re still going to need and want to buy and the housing market will go back to normal.
I’m Sommar Clark with the Clark Team, South Florida. I’m not giving my opinion. I’m just sharing what experts are saying and I thought it could be a service to you.
Feel free to reach out to me here at the Clark Team, South Florida, with any concerns or questions and always remember, we’re here to help.