Is this 2008 2.0?

Michelle Knutson|April 20, 2020

Hey there,

I hope this messages finds you and those you love in good health - we've all learned quickly how that truly is all that matters. We are in a time of vast uncertainty and to me, the unknown is the scariest part. I know you are being inundated with input and assumptions about the housing market, but I wanted to reach out today to share some of the research, facts, and data to help us understand how the coronavirus is really impacting real estate and hopefully bring some clarity and relief to you.

  1. The Nature of This Shift Is Vastly Different from 2008    

Today’s market conditions are a response to an external stimulus and are event driven. Similar to how 9/11 impacted New York City real estate, COVID-19 is causing a similar pause felt around the globe. 2008 was the opposite - inherent systemic failures in our financial systems caused a complete market crash needing a ground-up overhaul to recover. We hope to see a bounce-back recovery once the unknowns of COVID-19 are resolved similar to what NYC's market saw around January 2002.

The Goldman Sachs GDP Forecast indicates that although there is no growth anticipated immediately, gains are forecasted heading into the second half of this year and getting even stronger in early 2021. This is a momentary event in time, not a collapse of the financial industry.

  1. A Recession Does Not Equal a Housing Crisis

If we look at the past 5 recessions in U.S. history, home values actually appreciated in three of them. It is true that they sank by almost 20% during the last recession, but as stated above, 2008 presented much different circumstances than we have today. In the 4 previous recessions, home values depreciated only once and that was by less than 2%. Of the remaining 3, values actually increased despite a national recession.

  1. We Can Be Confident About What We Know

Concerns about the global impact COVID-19 will have on the economy are real. And they’re scary, as the health and wellness of our friends, families, and loved ones are high on everyone’s emotional radar. That said, we can be confident that, while we don’t know the exact impact the virus will have on the housing market, we do know that housing isn’t the driver.

We will get through this crisis and come out stronger on the other side.  In the meantime, if you have questions about what it means for your family’s home buying or selling plans, please reach out. I’m happy to help in any way I can.

In health and solidarity,


Work With Michelle

Having worked at one of the paramount couture brands and with multiple executives necessitating discretion based on their alternate careers, I have learned how invaluable it can be to respect a client’s time, act with discretion and provide premier customer service.

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