This document provides a summary of key housing market data and expert opinions on the potential economic impact of the COVID-19 pandemic. It shows data on home prices, inventory, and mortgage financing from 2000 to the present. Experts predict a recession but not a housing crisis, as the financial system remains sound, and a recovery in 2021. The document also notes measures by FHA and GSEs to limit foreclosures and evictions during this time.

2. 0
100
200
300
400
500
600
700
800
900
June
2004
June
2005
June
2006
June
2007
June
2008
June
2009
June
2010
June
2011
June
2012
June
2013
June
2014
June
2015
June
2016
June
2017
June
2018
June
2019
Today
Historic Data for the
MORTGAGE CREDIT
AVAILABILITY INDEX
(a report from the Mortgage Bankers Association)
MBA
Housing
Bubble
Today

3. Black Knight
8.6%
6.5%
8.5% 8.7%
12.5%
11.4%
2000 2001 2002 2003 2004 2005
4.4%
5.2% 5.5%
6.4%
4.8% 4.7%
2014 2015 2016 2017 2018 2019
The 6 years leading up
to the housing crash
The last 6 years
Annual Home Price Appreciation

4. NAR
Months Inventory of Homes for Sale
8.2
3.1
2007 Today

5. Total Home Equity Cashed Out
by Refinance in Billions
Year Dollars
2005 $263B
2006 $321B
2007 $240B
Total $824B
Year Dollars
2017 $71B
2018 $87B
2019 $74B*
Total $232B
Then… Now…
Freddie Mac
*Using the first 3 quarter estimates from Freddie Mac and estimating $20B for the 4th quarter

6. Percent of the median income needed
to purchase the median-priced home
21.2%
25.4%
14.8%
1985-2000 2006 TODAY
Zillow & NAR

7. How Has the
Housing Market
Been Impacted by
Previous Stock
Market Crashes?

8. -51%
-4.6%
-10%
-4.1%
S&P 500 Correction
10/2007 to 3/2009
Annual Home Price DEPRECIATION
Housing & Mortgage Crash
2007 2008 2009
Black Knight & S&P 500

9. “What 9/11 has in common with what is happening
today is that this shock has also generated fear, angst
and anxiety among the general public. People avoided
crowds then as they believed another terrorist attack
was coming and are acting the same today to avoid
getting sick. The same parts of the economy are
under pressure ─ airlines, leisure, hospitality,
restaurants, entertainment ─ consumer discretionary
services in general.”
David Rosenberg
Gluskin Sheff + Associates Inc.’s Chief Economist

10. -45%
8.6% 6.6% 8.5%
2000 2001 2002
S&P 500 Correction
9/2000 to 10/2002
Annual Home Price APPRECIATION
Dot.com & 9/11 Crash
Black Knight & S&P 500

11. Recession DOES NOT
Equal Housing Crisis

12. “With the sudden economic stop, and with
many states shutting down by closing down
schools, bars and restaurants…my view is the
US economy is now in a recession (started in
March 2020), and GDP will decline sharply
in Q2 (as Goldman Sachs is forecasting).
The length of the recession will depend on
the course of the pandemic.”
Bill McBride
Calculated Risk

13. -0.2%
-5%
3% 4%
-7.0%
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
Quarter 3 Quarter 4
“…with further strong gains in early 2021.”
Goldman Sachs GDP Forecast
on 3/17/2020
Quarter 2Quarter 1

14. “We do not expect a repeat of the severe
recession of 2008-2009, because the virus
and oil shocks are not endemic to the
financial system but are, rather, external.
Once the virus infection rate peaks,
we expect a recovery to gain momentum
into the final quarter of the year and
especially into 2021.”
Wells Fargo Investment Institute
3/17/2020

15. 6.1%
3.5%
-1.9%
6.6%
-19.7%
1980 1981 2001
HOME PRICE CHANGE
During Last 5 Recessions
1991 2008
CoreLogic National Home Price Index

16. Will we see a rise in the number of foreclosures?

17. The Federal Housing Administration indicated it is
enacting an “immediate foreclosure and eviction
moratorium for single family homeowners with
FHA-insured mortgages” for the next 60 days.
The Federal Housing Finance Agency announced it
is directing Fannie Mae and Freddie Mac to
suspend foreclosures and evictions for
“at least 60 days.”

18. Total Home Equity Cashed Out
by Refinance in Billions
Year Dollars
2005 $263B
2006 $321B
2007 $240B
Total $824B
Year Dollars
2017 $71B
2018 $87B
2019 $74B*
Total $232B
Then… Now…
Freddie Mac
*Using the first 3 quarter estimates from Freddie Mac and estimating $20B for the 4th quarter

19. National Association of Realtors
18.2
17.8
17.6
17
17.4
17.1
16.2
15.9
16.3
16.3
16.6
16.5
16.1
15.6
15.2
15.3
15.3
15.5
14.8
June July August September October November December January February March April May June July August September October November December January
Payment as a
% of Income
Historic Norm
21.2%

20. KeepingCurrentMatters.com/Coronavirus