Why the Stock Market Correction Most Likely Won’t Impact Home Values

Dated: March 24 2020

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Why the Stock Market Correction Probably Won’t Impact Home Values

This time, the stock market correction is being caused by an outside event (the coronavirus) with no connection to the housing industry. Many experts are saying the current situation is much more reminiscent of the challenges we had when the dot.com crash was immediately followed by 9/11. As an example, David Rosenberg, Chief Economist with Gluskin Sheff + Associates Inc., recently explained:

“What 9/11 has in common with what is happening today is that this shock has also generated fear, angst and anxiety among the general public. People avoided crowds then as they believed another terrorist attack was coming and are acting the same today to avoid getting sick. The same parts of the economy are under pressure ─ airlines, leisure, hospitality, restaurants, entertainment ─ consumer discretionary services in general.”

Since the current situation resembles the stock market correction in the early 2000s, let’s review what happened to home values during that time.Why the Stock Market Correction Probably Won’t Impact Home Values | Keeping Current MattersThe S&P dropped 45% between September 2000 and October 2002. Home prices, on the other hand, appreciated nicely at the same time. That stock market correction proved not to have any negative impact on home values.

Bottom Line

If the current situation is more like the markets in the early 2000s versus the markets during the Great Recession, home values should be minimally affected, if at all.

Source: Kcm. “Why the Stock Market Correction Probably Won't Impact Home Values.” Keeping Current Matters, KCM Crew Https://Www.keepingcurrentmatters.com/Wp-Content/Uploads/2017/01/KCMBannerNoWebsiteDarkLarge.png, 23 Mar. 2020, www.keepingcurrentmatters.com/2020/03/24/why-the-stock-market-correction-probably-wont-impact-home-values/?utm_campaign=Blog_Promo&utm_medium=email&utm_source=email-automated&utm_content=DailyBlogSubscription&utm_term=BlogPost.

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Andre Marines

Raised in a "real estate family" in Providence, Rhode Island I have had many years of exposure to the business. As a licensed real estate agent I have brought my talents to The Rhode Island Real Estat....

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