By Madelaine Braggs | Rose Law Group Reporter
The coronavirus pandemic and delayed relief stimulus has taken a toll on several areas of the economy. However, the housing market is uniquely thriving, with some home builders reporting a 70% year over year increases in sales according to economist Ali Wolf. All of this was discussed by a panel of superstars moderated by Rose Law Group Founder, Jordan Rose, for Home Aid.
Wolf, Chief Economist at Meyers Research, notes that many young couples saved up $30,000-$40,000 dollars for a wedding, but with social distancing guidelines have now chosen to buy homes instead. Still, as many Americans face unemployment, Wolf says “The recession is over for the rich, but the financial recovery is not over for the working class.”
Real estate consultant Elliott Pollack says the economy is truly bifurcated. Those who have been able to stay employed are seeing money pile up. They can’t go out to dinner, ballgames, on vacation, nothing that involves crowd. But on the other hand, those were laid off in jobs like retail, restaurants and entertainment (people who were not really in the housing market to begin with) are now even farther from that goal with increased financial stress.
“It’s the sleaziest thing I’ve ever heard of,” Pollack said referring to Congress taking recess this month, before both sides of the aisle could agree on a new stimulus package bill. “This isn’t a typical recession caused by normal economic factors, this recession was caused by a government shutdown fighting a disease.”
While the housing market may be ideal for sellers, it’s having side effects for home builders. Brad Schoenberg, Division President of Taylor Morrison, says with housing demand skyrocketing, prices for lumber are climbing as well. Schoenberg recalls a similar trend following the 2008 recession, and says this time around, home builders are learning from past mistakes. He says the home building industry must not stall the market by being over aggressive in home prices.
According to the panel, Phoenix’s housing market was among the quickest to rebound since COVID-19 and is the best performing major market in the nation in terms of jobs. Pollack says it’s not that we’ve gained jobs, but rather we’ve lost less jobs than other large cities. While the national unemployment rate is 10.2%, the unemployment rate in Phoenix is just under 9% for July. In other top metro markets, the unemployment rate can be around 15%.
This economic analysis was brought to you by HomeAid America – Phoenix, a non-profit organization dedicated to helping the Phoenix homeless population. To learn more about the good work that they do, click here.