US data suggest a checkmark-shaped real estate

Real Estate

Past analysis has shown that the COVID-19 pandemic and associated lockdowns will cause a significant dip in real estate activity. The latest U.S market data shines a light on what the dip and recovery will look like — a checkmark shape, with an immediate drop, three to four weeks at the bottom and a slow recovery period.

The effects of the dip are clearest in early-hit markets like Seattle in King County. It took approximately one week to hit the bottom, with another two weeks at the bottom before a rebound began. As expected, new listings are down 50 percent for the month compared to 2019, with a slow, 20 percent recovery each week.

It is a similar story in California’s East Bay market. Once shelter-in-place orders were issued, it took only one week to hit the bottom. The dip lasted two to three weeks before a rebound in activity began. Like Seattle, the recovery is slow and gradual, with new listing volumes still down 50 percent from the previous year.

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