COVID Baby Boom?

May 20, 2020
Baby Boom
The fallout from the pandemic and “new normal” may require homeowners to reevaluate their needs.

MBA chief economist Michael Fratantoni said that a COVID-19 related baby boom or a pandemic-related increase in divorces could potentially spur some demand in housing and household formation. Fratantoni speaking at the virtual industry pow-wow, Mortgage2020, said that the dueling hypothesis that people have at the moment is that nine months from now we are going to have a bit of a baby boom. The other is three months from now the divorce rate is going to kick up. “One or both of these things could happen and that is an immediate increase in housing demand and household formation,” he said.

Fratantoni said that another driver for housing could be the desire for home office space. Looking forward, the crisis could weaken the demand for office space as businesses embrace the remote work environment. On the flip side of that is that you are spending a lot of time at home. “Many people are recognizing they are using the home to a greater extent than they ever did before so maybe their demand is going to shift up,” he said. “In the long run, a little less office demand and a little more office demand might be the result of this.”

Source: National Mortgage Professional