As more clinical trials are being conducted to come up with an effective and safe COVID-19 vaccine, millions of people are waiting impatiently. According to real estate and economy experts, the COVID-19 vaccine could directly affect the urban real estate market.
What is the current status of the urban real estate market?
The pandemic, historically low mortgage rates, and home inventory numbers have driven up home prices to where we are now seeing record high price tags in suburban and rural areas. This is not the case in certain urban areas, like New York City and San Francisco, where houses and rentals have been historically more costly. We are currently seeing higher vacancy rates in rentals and lower house prices. In fact, Manhattan records its vacancy rate at a new all-time high of 6.14%. With the steep drop in rental and housing rates in big cities, experts anticipate the decrease may continue until a vaccine is approved.
How exactly does the COVID-19 vaccine relate to urban real estate?
With potential vaccines on the horizon, real estate in big cities could see a turnaround.
According to the experts, the promise of a vaccine could turn the tide for these urban areas, bringing real estate demand back to the cities. Jonathan Miller, president of Miller Samuel and a real estate appraiser and consultant in New York City, commented on this possibility and how it would come about: “It’s not going to be a light switch, but the news is starting to get people to be hopeful and think about returning to the city. Because right now, without a vaccine, it is status quo.
