Pandemic Fuels a Major Shift for Consumer Spending in Favor of Housing
GREENSBORO, N.C.–(BUSINESS WIRE)–
Strong demand for housing should outlast the end of 2020, according to the Fall edition of The Housing and Mortgage Market Review (HaMMR), released today by Arch Mortgage Insurance Company (Arch MI), a leading provider of mortgage insurance.
“Ironically, the difficult economic situation has benefited housing,” said Ralph G. DeFranco, Ph.D., HaMMR author and Global Chief Economist for Arch Capital Services, Inc. “The pandemic has resulted in interest rates at all-time lows and the general realization that housing has never been more important. Demand is so strong that we’ve had two straight months of a record-low number of homes for sale. That has set the stage for continued positive home-price growth in 2021.”
The latest HaMMR explains why the factors driving today’s housing market are likely to continue.
“The pandemic is limiting people’s expenditures on other large-scale items, such as weddings and international travel,” DeFranco said. “Instead, people are seeking additional space for home offices and leisure needs, such as exercise equipment and room for a backyard barbecue. Second homes are also being snapped up in record time.”
Home prices are up in all 50 states over the past year, with the fastest growth occurring in Idaho, Arizona, Montana, New Mexico and Wyoming. The slowest growth rate in home prices occurred in Hawaii, Illinois, North Dakota, Alaska and Iowa.
Commentary resources:
- The Housing and Mortgage Market Review is posted at archmi.com/hammr. The Fall 2020 issue focuses on the pandemic’s impact and what is driving the shortage of homes for sale. It also describes trends to watch in 2021, including more rental single-family housing, a shift in construction to larger homes and what the future of remote work will look like.
- DeFranco will host a Housing Update webinar discussing market conditions and the details of HaMMR on Thursday, Nov. 12 (1 p.m. ET/10 a.m. PT). Registration is free at archmi.com/hammr.
About Arch Mortgage Insurance Company
Arch Capital Group Ltd.’s U.S. mortgage insurance operation, Arch MI, is a leading provider of private insurance covering mortgage credit risk. Headquartered in Greensboro, North Carolina, Arch MI’s mission is to protect lenders against credit risk, while extending the possibility of responsible homeownership to qualified borrowers. Arch MI’s flagship mortgage insurer, Arch Mortgage Insurance Company, is licensed to write mortgage insurance in all 50 states, the District of Columbia and Puerto Rico. For more information, visit archmi.com.
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The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. This release or any other written or oral statements made by or on behalf of Arch Capital Group Ltd. and its subsidiaries may include forward-looking statements, which reflect our current views with respect to future events and financial performance. All statements other than statements of historical fact included in or incorporated by reference in this release are forward-looking statements.
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Arch Capital Services Inc.
Greg Hare, 336-333-0416
Method Communications
Margaret Bonaparte, 415-891-4914
Source: Arch Capital Group Ltd.