It’s the current, not the waves, that will propel longstanding changes in the American housing market, said Logan Mohtashami, HousingWire’s lead analyst.
How much housing is built and sold; who pays for those units; and how Americans ground their lives in what and where they live: these forces are rooted in societal and family culture and largely impervious to surface turmoil.
The economic disruption caused by the global COVID-19 pandemic, of course, was much more than just surface turmoil. But in the trial by fire of COVID, Mohtashami’s economic models proved incredibly accurate, laying the groundwork for his predictions for the rest of this year and next.
In winter 2020, on the brink of the COVID-19 pandemic, the housing economy was “on an even keel,” Mohtashami said. As early as February 2020, Mohtashami foresaw the potential for the global pandemic’s “butterfly effect” on lowering mortgage rates and how, contrary to most other predictions, we would likely see an economic expansion as a result by the third and fourth quarter of 2020. Then in April 2020, in the depths of the COVID crisis, Mohtashami correctly predicted the timing and shape of the economic recovery, laying out a roadmap in his “America is Back” model.
Panicked prognosticators who forecast widespread disaster for housing were quickly proven wrong when “the leading economic indices bottomed out in April 2020 and have been rising ever since,” he said. The key is a demographic surge of Millennials reaching peak home-buying age from 2020 to 2024, Mohtashami holds, which will provide replacement buyers for housing during these years.
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