It’s been just over four months since the novel coronavirus upended North America, sending cities across the continent into mass lockdown and, in turn, bringing the economy to a halt.
While “normal” — whatever that means — is still far off, some aspects of the housing market are beginning to rebound in select regions.
And our neighbours to the south, as a whole, have seen the US housing market recover from the immediate disruption caused by the COVID pandemic and return to January 2020 growth levels, according to a recent report from Realtor.com. This is despite the fact that many states are continuing to suffer record-highs in both the number of new COVID cases and COVID-related deaths.
Of course, it’s no secret that the US is a huge country with varying levels of population throughout; this is reflected in the report, where the rebound is more evident in some areas than others.
On a national level, the US Housing Market Recovery Index reached 101.0 nationwide for the week ending July 18, bringing the index above the pre-COVID recovery benchmark for the first time since March. However, the gains were not felt equally across the country.
According to the report, states in the Northeast (106.3) and West (105.5) are showing the greatest growth, with the Northeast leading the overall recovery, while those in the South (97.9) and Midwest (97.3) — which are now experiencing the aforementioned wave of COVID-19 infections and deaths, along with the restrictions and economic uncertainty that come with them — are still lagging behind, though many are starting to regain momentum.
The “recovery index” combines several market metrics and compares the results through July 18 with January 2020 levels. These metrics include growth in online search activity and new listings, as well as asking prices and time on the market.
Data from Realtor.com shows that in total, 18 of the 50 largest US housing markets have reached or even surpassed January levels of market activity. What’s more, 25 of the largest 50 markets in the country are now above the recovery benchmark, with the overall index showing the greatest recovery in Boston, Seattle, New York, Philadelphia, and Denver.
However, markets in the sunbelt (Florida, Georgia, Louisiana, and Alabama) continue to see re-emerging COVID concerns, and parts of the midwest (Michigan, Indiana, and Wisconsin), which have vulnerable economies, are failing to see material improvements in recent weeks, according to the report.
At home, transactions were up on a month-over-month basis across the country in June, with Canada’s largest markets showing the biggest gains. Here in the Greater Toronto Area (GTA), sales were up an impressive 83.8%, followed by Montreal (75.1%), Greater Vancouver (60.3%), Edmonton (59%), Ottawa (55.6%), Calgary (54.9%), and Quebec City (43.6%). What is interesting to note is the Fraser Valley in BC saw the largest sales increase of 99.7%.
In fact, in June Toronto posted the highest average home price on record at just shy of $931,000.
To many insider’s surprise, so far, while COVID-19 has been able to disrupt the North American real estate sector, it hasn’t been able to keep it down. Only a second-wave will tell whether or not the full storm can be weathered — both in Canada and the US.