The US Housing Market, What Changed Since 2020

One thing that almost everyone in the cities of the US has noticed this year is rent has increased, studies have shown that rent climbed in about 7% on average, rent is an important indicator of the economy since an estimated $33 billion is owed in back by almost 6 million Americans in the first quarter of 2021, and the low income class of immigrants and minorities are the most ones suffering from the impact of the corona virus on the economy. The latest survey of Census about household incomes has shown that 20% of households earning less than $30,000 were late on paying rent.

More data have shown that rents increased in the suburbs and rural areas of the counties, to outpace the urban areas, the data also have shown an inverse relationship between income and rent, in California for example rents increased in most counties outside the wealthy areas.

It’s a no brainer that the recession caused by this pandemic had a higher impact on the Americans with lower income and households of communities of color, the financially vulnerable households will definitely fall behind when it comes to paying the bills.

As for 2021, at Harris County, Houston, Texas, the housing market in not an exception, many businesses have closed doors and rents climbed as well, the rate is less significant than the country’s average it’s around 0.6% from the data published in the Zumper annual report on the changes seen on the housing market, the people are positive after the Biden administration’s passing the rescue plan with some high numbers to cover back rent and utilities, it’s around $21.6 billion, but there will be an $11 billion of owed back rent that will persist even with the federal assistance.    

The housing market is closely attached to the financial prosperity of households, less businesses are welling to open when people are struggling and less mortgages will be delivered since the filing won’t be as likely as before the pandemic, and this is a major factor that will disturb the housing market since financing is the motor of the sector.

When looking back to 2020, the rental market was more in a decreased trend and more affordability of expensive houses, unlike the cheaper places that saw a rise in rent prices, nothing weird in this, it comes to the normal laws of economics where sectors and branches with more demand are more likely to see more increase in prices, and we should not forget that the surprise effect of the pandemic did really disturb everyone’s behavior, and people were doing all sort of things to stay safe and save themselves of the unpredicted and the unknown facing the alerting situation.

I think with the progression of the vaccination campaign and people being more accepting of the situation I can say that the impact of the pandemic vanishes every day, the housing market will see a refresh in the few months to come since people’s behavior is in constant change and solutions to work and prosper during this pandemic are seen all over the world.

 

 

 

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