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Home Buyers and Sellers are asking, “What is the real estate market doing today?”; “What is the outlook in the coming months?” “Are we going to experience another recession and housing crash like back in 2008?”

It is not just the home buyers and sellers who are experiencing a lot of uneasiness right now with the uncertainty of what COVID-19 will bring. Many real estate agents themselves are hesitant to give any projections, especially with no clear end in sight of restrictions being lifted.


Notable stats and market trend guru, Steve Harney, Founder and CEO of Keeping Current Matters, has been tracking what Goldman Sachs, JP Morgan, Morgan Stanley, and Wells Fargo
are saying about the impact of the pandemic.

The consensus of the top financial institutions is that there are hints of a V-shaped recovery. V-shaped recovery is the best possible outcome, meaning with such an abrupt decline the outcome will be equally as quick and steep on the other side.


This is a health crisis, not a housing crisis. Financial leaders and researchers have confirmed that with past outbreaks, such as the Spanish flu of 1918, the economic recovery has been V-shaped.



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Sale of Single Family Homes- Confirmed


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With such a short period at the bottom of the curve, the overall negative economic impact will be less. The time frame of employment rates getting back to before COVID levels will be lessened as well with numbers as low as 2 years being tossed about. The recession of 2008, it took 7 years for employment rates to recover.



There are several indicators of the current real estate decline from the housing crash that happened in 2008.

1. APPRECIATION – In the 6 years leading up to the 2008 crash, home prices had appreciated up to 11-12%. Even though the Nova Scotia market has seen some significant home value increases of 5-6%, it is nowhere near the runaway appreciation of before the crash. The higher you are, the harder you fall.

2. CREDIT AVAILABILITY – Before 2008 it was fairly easy to get a mortgage, which led to the mortgage bubble. The Mortgage Credit Availability Index was between 800-900. Due to stricter mortgage requirements and regulations that were implemented as a result, the index has been sitting between 100-200 almost ever since the crash.

3. INVENTORY – It was a Buyer’s market at the peak of 2008, with 11 and 12 months of inventory. (A Buyer’s market has over 7 months’ worth of inventory). For over a year now, we have been in a Seller’s market with only 3-5 months’ worth of inventory. That inventory has only gotten worse with the pandemic restrictions in place with new listings dropping approximately 75% in Nova Scotia in the past two weeks from the same period last year.

4. REFINANCING – Consumer trends leading up to the housing crash, were such that many homeowners were using the equity in their house to finance lifestyle. Many consumers took advantage of the credit availability index is so high as a means of living a better life.
Since then consumer attitudes have changed. Less and fewer consumers and homeowners have seen using credit as an income source. The amount that home buyers have refinanced using equity from their home is 1/3 to 1/4 of what it was in the years leading up to the crash.

5. EQUITY BUILT-UP – With homeowners having used up any equity built up in their homes before 2008 it was a lot easier to decide to walk away and let their property be taken back by the banks. More homeowners today have a substantial amount of equity built up in their homes and are less likely to walk away from that investment.


The unprecedented current unemployment rate may not have an impact on the housing market as the layoffs are presumably temporary and limited to consumer sectors that were less likely to be in the market to buy or sell housing. And with emergency response benefits will hopefully allow consumers to keep their bills paid and credit rating in tack.

While buyers may be expecting housing prices to fall dramatically, this is unlikely to happen with inventory this low. In fact, for Buyers who need to buy, there are still multiple offer situations happening on homes in certain areas.

Since the real estate, locally and nationally has crucially low inventory before the pandemic and sale prices were steadily increasing, combined with the anticipation of a V-shaped recovery, it will most likely result in neutral market response.

If business normalizes toward the end of Q2, then the year-end sale price increases will most likely be nullified and end up matching those of the previous year. Any longer than that the market should anticipate a marginal decrease of approximately 1% in home prices.

Compiled from

4. COVID-19 and the Real Estate Industry- Dawn Magee- March 17, 2020