Here’s what could happen
Americans are basically plugging their fingers in their ears and completely denying the worst case scenarios here.
Here are various results for real estate
- financials markets crash, leading to consumer spending to grind to a halt and people needing to Derisk their balance sheets and move to more cash
- older Americans get hit hard with the virus as it continues to spread exponentially through the population
- older homeowners pass away or become very sick, forcing folks to sell investment property or their own homes to cover higher medical expenses = inventory increases
- home tours slow as people self quarantine themselve, leading to higher DOM and less demand
- same goes for investment properties - investors can’t send people out to conduct due diligence
- tours and lease up slows in the multifamily sector, especially hitting the Class A space. Some recently delivered apartment buildings struggle financially and defaults occurs
- the short term office/rental sector gets hit hard
- office lease up grinds to a halt as employers space corporate expansions and decision makers get pulled into more important decision making (or unable to make decisions - same goes for A&E folks consulting them)
- trade slows down causing industrial to suffer
- retail assets struggle with consumers taking a 1-3 month pause from eating and buying goods/services
- after 2-3 months of reduced sales, struggling retail companies (especially mom and pops) face dire financial situations and are forced to close
I don’t think real estate will be impacted tomorrow, but by 4Q the industry is going to be impacted heavily after the impacts cause loans to default from higher vacancy and lower income