This week, HousingWire’s Editor in Chief Sarah Wheeler interviews Logan Mohtashami, HousingWire’s lead analyst, to discuss how the housing market performed despite impacts from the COVID-19 pandemic.
Additionally, Mohtashami dives into his most recent HW+ article that asks: should Americans buy a home in a super-hot housing market?
Here is a small preview of the interview, which has been lightly edited for length and clarity:
Sarah Wheeler: Housing market demographics is one of the hallmarks of your work and what you’re looking at to predict what’s happening next. So, tell us why 2020 to 2024 is so unique and why that informed your whole model.
Logan Mothashami: So, if economics is demographics and productivity, then housing economics is really driven by demographics and mortgage rates. So, coming from the weakest housing market recovery ever, the labor force peaked in 2007 and declined. Household formation has to work itself up because demand will never warrant it, which is probably my biggest disagreement with every economist and analyst who thinks we don’t build enough homes. Builders only build off of their own demand curve. It was the weakest new home sales cycle ever recorded in history; 2013 was a miss, 2014 was a miss, and 2015 missed estimates. In 2018 the housing market had a supply spike, but builders said it was the worst quarter since the great financial crisis: there was not only an 82% crash in new home sales, but we had the weakest recovery.