April 6, 2020

How Will Surging Unemployment Affect Housing?

Will Surging Unemployment Crush Home Sales?

Will Surging Unemployment Crush Home Sales? | MyKCM

Ten million Americans lost their jobs over the last two weeks. The next announced unemployment rate on May 8th is expected to be in the double digits. Because the health crisis brought the economy to a screeching halt, many are feeling a personal financial crisis. James Bullard, President of the Federal Reserve Bank of St. Louis, explained that the government is trying to find ways to assist those who have lost their jobs and the companies which were forced to close (think: your neighborhood restaurant). In a recent interview he said:

“This is a planned, organized partial shutdown of the U.S. economy in the second quarter. The overall goal is to keep everyone, households and businesses, whole.”

That’s promising, but we’re still uncertain as to when the recently unemployed will be able to return to work.

Another concern: how badly will the U.S. economy be damaged if people can’t buy homes?

A new concern is whether the high number of unemployed Americans will cause the residential real estate market to crash, putting a greater strain on the economy and leading to even more job losses. The housing industry is a major piece of the overall economy in this country.

Chris Herbert, Managing Director of the Joint Center for Housing Studies of Harvard University, in a post titled Responding to the Covid-19 Pandemic, addressed the toll this crisis will have on our nation, explaining:

“Housing is a foundational element of every person’s well-being. And with nearly a fifth of US gross domestic product rooted in housing-related expenditures, it is also critical to the well-being of our broader economy.”

How has the unemployment rate affected home sales in the past?

It’s logical to think there would be a direct correlation between the unemployment rate and home sales: as the unemployment rate went up, home sales would go down, and when the unemployment rate went down, home sales would go up.

However, research reviewing the last thirty years doesn’t show that direct relationship, as noted in the graph below. The blue and grey bars represent home sales, while the yellow line is the unemployment rate. Take a look at numbers 1 through 4:Will Surging Unemployment Crush Home Sales? | MyKCM

  1. The unemployment rate was rising between 1992-1993, yet home sales increased.
  2. The unemployment rate was rising between 2001-2003, and home sales increased.
  3. The unemployment rate was rising between 2007-2010, and home sales significantly decreased.
  4. The unemployment rate was falling continuously between 2015-2019, and home sales remained relatively flat.

The impact of the unemployment rate on home sales doesn’t seem to be as strong as we may have thought.

Isn’t this time different?

Yes. There is no doubt the country hasn’t seen job losses this quickly in almost one hundred years. How bad could it get? Goldman Sachs projects the unemployment rate to be 15% in the third quarter of 2020, flattening to single digits by the fourth quarter of this year, and then just over 6% percent by the fourth quarter of 2021. Not ideal for the housing industry, but manageable.

How does this compare to the other financial crises?

Some believe this is going to be reminiscent of The Great Depression. From the standpoint of unemployment rates alone (the only thing this article addresses), it does not compare. Here are the unemployment rates during the Great Depression, the Great Recession, and the projected rates moving forward:Will Surging Unemployment Crush Home Sales? | MyKCM

Bottom Line

We’ve given you the facts as we know them. The housing market will have challenges this year. However, with the help being given to those who have lost their jobs and the fact that we’re looking at a quick recovery for the economy after we address the health problem, the housing industry should be fine in the long term. Stay safe.

Contact Dave Sulvetta

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April 3, 2020

Real Estate - After COVID-19

 

Looking to the Future: What the Experts Are Saying

Looking to the Future: What the Experts Are Saying | MyKCM

As our lives, our businesses, and the world we live in change day by day, we’re all left wondering how long this will last. How long will we feel the effects of the coronavirus? How deep will the impact go? The human toll may forever change families, but the economic impact will rebound with a cycle of downturn followed by economic expansion like we’ve seen play out in the U.S. economy many times over.

Here’s a look at what leading experts and current research indicate about the economic impact we’ll likely see as a result of the coronavirus. It starts with a forecast of U.S. Gross Domestic Product (GDP).

According to Investopedia:

“Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period. As a broad measure of overall domestic production, it functions as a comprehensive scorecard of the country’s economic health.”

When looking at GDP (the measure of our country’s economic health), a survey of three leading financial institutions shows a projected sharp decline followed by a steep rebound in the second half of this year:Looking to the Future: What the Experts Are Saying | MyKCMA recent study from John Burns Consulting also notes that past pandemics have also created V-Shaped Economic Recoveries like the ones noted above, and they had minimal impact on housing prices. This certainly gives hope and optimism for what is to come as the crisis passes.

With this historical analysis in mind, many business owners are also optimistic for a bright economic return. A recent PricewaterhouseCoopers survey shows this confidence, noting 66% of surveyed business owners feel their companies will return to normal business rhythms within a month of the pandemic passing, and 90% feel they should be back to normal operation 1 to 3 months after:Looking to the Future: What the Experts Are Saying | MyKCMFrom expert financial institutions to business leaders across the country, we can clearly see that the anticipation of a quick return to normal once the current crisis subsides is not too far away. In essence, this won’t last forever, and we will get back to growth-mode. We’ve got this.

Bottom Line

Lives and businesses are being impacted by the coronavirus, but experts do see a light at the end of the tunnel. As the economy slows down due to the health crisis, we can take guidance and advice from experts that this too will pass.

April 1, 2020

Get Ready to Buy A Home!

From a Market Expert! 

The #1 Thing You Can Do Now to Position Yourself to Buy a Home This Year

The #1 Thing You Can Do Now to Position Yourself to Buy a Home This Year | MyKCM

The last few weeks and months have caused a major health crisis throughout the world, leading to a pause in the U.S. economy as businesses and consumers work to slow the spread of the coronavirus. The rapid spread of the virus has been compared to prior pandemics and outbreaks not seen in many years. It also has consumers remembering the economic slowdown of 2008 that was caused by a housing crash. This economic slowdown, however, is very different from 2008.

One thing the experts are saying is that while we’ll see a swift decline in economic activity in the second quarter, we’ll begin a sharp rebound in the second half of this year. According to John Burns Consulting:

“Historical analysis showed us 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 team showed the current slowdown is playing out similarly thus far.” 

Given this situation, if you’re thinking about buying a home this year, the best thing you can do right now is use this time to get pre-approved for a mortgage, which you can do from the comfort of your home. Pre-approval will help you better understand how much you can afford so that you can confidently do the following two things when you’re ready to buy:

1. Gain a Competitive Advantage

Today’s low inventory, like we’ve seen recently and will continue to see, means homebuyers need every advantage they can get to make a strong offer and close the deal. Being pre-approved shows the sellers you’re serious about buying a home, which is always a plus in your corner.

2. Accelerate the Homebuying Process

Pre-approval can also speed-up the homebuying process so you can move faster when you’re ready to make an offer. Being ready to put your best foot forward when the time comes may be the leg-up you need to cross the finish line first and land the home of your dreams.

Bottom Line

Pre-approval is the best thing you can do right now to be in a stronger position to buy a home when you’re ready. Let’s connect today to get the process started.

Contact Dave Sulvetta REMAX Connection

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March 31, 2020

Buying a Home Is STILL a Great Investment

The Economic Impact of Buying a Home

The Economic Impact of Buying a Home | MyKCM

We’re in a changing real estate market, and life, in general, is changing too – from how we grocery shop and meal prep to the ways we can interact with our friends and neighbors. Even practices for engaging with agents, lenders, and all of the players involved in a real estate transaction are changing to a virtual format. What isn’t changing, however, is one key thing that can drive the local economy: buying a home.

We’re all being impacted in different ways by the effects of the coronavirus. If you’re in a position to buy a home today, know that you’re a major economic force in your neighborhood. And while we all wait patiently for the current pandemic to pass, there are a lot of things you can do in the meantime to keep your home search on track.

Every year the National Association of Realtors (NAR) shares a report that notes the full economic impact of home sales. This report summarizes:

“The total economic impact of real estate related industries on the state economy, as well as the expenditures that result from a single home sale, including aspects like home construction costs, real estate brokerage, mortgage lending and title insurance.”

Here’s the breakdown of how the average home sale boosts the economy:The Economic Impact of Buying a Home | MyKCMWhen you buy a home, you’re making an impact. You’re fulfilling your need for shelter and a place to live, and you’re also generating jobs and income for the appraiser, the loan officer, the title company, the real estate agent, and many more contributors to the process. For every person or business that you work with throughout the transaction, there’s also likely a team behind the scenes making it all happen, so the effort multiplies substantially. As noted above in the circle on the right, the impact is almost double when you purchase new construction, given the extra labor it requires to build the home.

The report also breaks down the average economic impact by state:The Economic Impact of Buying a Home | MyKCMAs a buyer, you have an essential need for a home – and you can make an essential impact with homeownership, too. That need for shelter, comfort, and a safe place to live will always be alive and well. And whenever you’re able to act on that need, whether now or later, you’ll truly be creating gains for you, your family, local business professionals, and the overall economy.

Bottom Line

Whenever you purchase a home, you’re an economic driver. Even if you’re not ready or able to make a move now, there are things you can do to keep your own process moving forward so you’re set when the time is right for you. Let’s connect to keep your home search – and your local contributions – on track.

July 30, 2019

1607 Hider Ln Clementon NJ 08021

1607 Hider Ln Clementon NJ 08021  Gloucester Twp NJ Home For Sale

Welcome to 1607 Hider Ln Clementon NJ 08021!

You will love this great home! 1607 Hider Ln Clementon NJ, features a wonderfully kept backyard with a beautiful, refreshing in ground pool. Your family will spend countless hours enjoying the limitless times you'll be spending making memories in the great backyard!

The home's interior also features a large great room off the back of the house and a wide open floor plan. 

The family room is large enough for family gatherings and directly off the living, with an unobstructed view is the newly updated kitchen. There is hard wood floors throughout the main level.

1607 Hider Ln Clementon NJ    1607 Hider Ln Clementon NJ   1607 Hider Ln Clementon

Contact Dave Sulvetta for your private showing! Call 856.889.8163

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May 10, 2019

How's The Market In Gloucester Twp NJ?

Gloucester Twp NJ homes for sale  Gloucester Twp NJ Market Report - May 2019

Follow the link below to review homes for sale, Pending and sold homes in Gloucester Twp NJ. If you have any questions or would like to speak with me about listing your home, please call my cell at 856.889.8163 or email me at Dave@DaveSulvetta.com

Gloucester Twp NJ Market Report for May 2019

 

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May 15, 2018

191 La Costa Dr Blackwood NJ 08012

191 LA COSTA DRIVE, BLACKWOOD, NJ | Valleybrook

$ Click for current price
3 BEDROOMS | 3 (2 full, 1 half ) BATHROOMS | 1914 SQUARE FEET

Absolutely gorgeous town home located in the Links section of Valleybrook. 191 La Costa Dr Blackwood NJ, is now available! This home rocks and is located on the golf course and will offer plenty of beautiful views! The owners have upgraded this home quite nicely and includes new Bamboo wood floors, newer heater and central air conditioning, almost all new windows, new paint and more. Stainless steel appliances in the kitchen and soft colors throughout the home. The moment you enter this lovely home, you will be welcomed by a lovingly kept, bright interior. The bedrooms have all new flooring and paint. There is new hardwood flooring in two of the bedrooms and the master bedroom has newer carpet. There is a fireplace for those cold winter nights. Come see this beautiful Valleybrook town home before it is too late!
April 17, 2018

17 Brookside Dr Sewell NJ 08080

17 BROOKSIDE DRIVE, SEWELL, NJ

$ Click for current price
3 BEDROOMS | 3 (2 full, 1 half ) BATHROOMS | 1889 SQUARE FEET

17 Brookside Dr Sewell NJ is located in the well sought after Crossroads development. This home has been lovingly kept and cared for by the present owners and is ready for you to move in! The home is exceptionally clean and has an updated kitchen, updated windows, heater and air conditioner. The family room is right off the kitchen and has a brick fireplace for those cold winter nights! The backyard has plenty of room to entertain guest or just relax with the family. Upstairs there are 3 very nice sized bedrooms and the master bedroom has it's own master bath. Come take a look at this great home before it's gone!

Contact Dave Sulvetta REMAX Connection 856.889.8163

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April 11, 2018

7 Cypress Pt Ct Blackwood NJ | Valleybrook

7 Cypress Pt Ct, Blackwood, NJ  Valleybrook Town Homes For Sale

Just Listed

$ Click for current price
1914 SQUARE FEET

7 Cypress Pt Ct Blackwood - The Links II in Valleybrook. Super nice town home in move in condition and ready to go. This home has been very well kept and cared for and is ready for its new owner. The family room has cathedral ceilings that gives the room an enormous appeal. Enjoy the gas fireplace on those cold winter nights. Off the side of the family room is the large eat in kitchen. There are 3 good sized bedrooms upstairs and the master suite has its own master bath and two closets. Come check out this great Valleybrook Golf Course Community home today!

 

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April 11, 2018

7 Cypress Pt Ct Blackwood NJ

7 Cypress Pt Ct, Blackwood, NJ  Valleybrook Town Homes For Sale

Just Listed

$ Click for current price
1914 SQUARE FEET

7 Cypress Pt Ct Blackwood - The Links II in Valleybrook. Super nice town home in move in condition and ready to go. This home has been very well kept and cared for and is ready for its new owner. The family room has cathedral ceilings that gives the room an enormous appeal. Enjoy the gas fireplace on those cold winter nights. Off the side of the family room is the large eat in kitchen. There are 3 good sized bedrooms upstairs and the master suite has its own master bath and two closets. Come check out this great Valleybrook Golf Course Community home today!

 

Search ALL Valleybrook Homes For Sale