The Texas housing and construction market leads the country in single-family home construction and sales. San Antonio’s real estate market is robust, and its potential buyers recognize the “down economy” as temporary, making NOW the time to buy. The team at Diamante Custom Homes has adapted during this crisis to continue to work under strict OSHA and CDC guidelines to meet current demand and prepare for the rebound in our economy.
“Housing is Set to Help Lead the Way Out”
“Residential and commercial construction is being deemed essential in many markets,” said Robert Dietz, chief economist with the National Association of Home Builders. “This is particularly important as repair and new building needs to continue…the housing sector enters this recession under built rather than over built” he said. Meaning, as the economy rebounds — which it will — housing is set to help lead the way out.
“As local Developers and Veteran Builders that successfully navigated through the 2008 recession and mortgage crisis, we are already leading by example. We will be ready when this Pandemic is over and prepared to kick start our economy”
-Adam Sanchez, President | Diamante Custom Homes
Proven Trends. Positive Outlook.
Historically low inventory and rock-bottom mortgage rates would normally set the stage for a highly competitive home buying season. While dips in the economy normally have only a minor effect on the housing market, the coronavirus, also known as COVID-19, is making life and markets anything but normal.
Ali Wolf, chief economist with Meyers Research, thinks the housing market can quickly bounce back as the impact from the pandemic fades. The last recession was triggered by loose lending and speculation in the home market, but housing is now on strong footing.
“Last time housing led the recession,” Wolf said. “This time it’s poised to bring us out.” Where is San Antonio poised in this? The media often talks about the U.S. real estate market as if there’s only one. It’s more accurate to think of it in terms of local “micro markets,” each with its own unique characteristics. Supply and demand, employment, afford-ability — these factors can vary greatly from one city to the next. Texas, San Antonio included, was poised to lead the national market prior to this unforeseen pandemic.
Learning from the Past & Moving Forward
The good news is we see is that the duration of COVID-19’s impact on the U.S. economy could be quite short-lived.
For two reasons:
- Governments’ willingness across the globe to enact both extreme containment measures and offer multiple policies to support Americans. For example, President Donald Trump has already signed the CARES Act into law to provide financial help to people and small businesses.
- The strength of our real estate market before and during this crisis. Ultimately, once Texans are assured our health is no longer at risk, we will be back stronger than ever. Texas Comptroller Glenn Hegar about the coronavirus’ impact on the state economy–“Texas before this downturn was a strong, if not one of the strongest, economy, we’re going to return back to a strong economy... I don’t think you’ll see a significant decrease in property values.” A truth led by demand and a shortage of new homes prior to this pandemic.
In an environment where the coronavirus is under control, the market will work through the correction without going into crisis mode. The administration has signaled they are willing to help where needed. For example, the inability to pay bills or service debt becomes a real concern with reduced hours or layoffs. The government and IRS are creating policies to offer some flexibility to consumers and businesses impacted by COVID-19.
We must look at the opportunity. Considering reasonable confidence and job stability, we can continue to see opportunistic buyers excited about the sub -4.0% mortgage rates.
Are Home Builders and Commercial Construction Supply Lines Being Disrupted by Coronavirus? Prepare for a Bright Future.
The short answer is yes. Nearly a third of home building material inputs come from China, according to the National Association of Home Builders–not to mention more finished products like bathtubs, sinks, appliances, and more. These supply lines have been disrupted.
This could delay home construction at a time when it has finally picked back up. Since the “Great” financial comeback, home building has struggled to keep pace with an intense demand because of the cost of construction, lack of available land, and a construction labor shortage. People and businesses need homes and construction to continue to prosper. We hope to be ready when this health crisis is over, with a renewed vigor and spirt to press forward and rebuild.
The concern? If supply lines are disrupted, could it dampen the pace of home building and contribute to inventory shortages? What is being done to prepare our industry, and our economy, for success in the aftermath of the Coronavirus Pandemic?
Stay Tuned fellow San Antonians!
We hope to bring you weekly updates on what is going on in our economy, how it effects our city, and our country concerning the recent Coronavirus health crisis.
We at DCH appreciate you during these uncertain times as we prepare for better days.
Please, don’t hesitate to reply to us for more answers or regarding our current Luxury offerings and exclusive downtown investment opportunities.