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Innovations in Home-Buying Process May be Fueling Pricing Frenzy
Friday, December 4, 2020
A noted housing researcher has analyzed
the current frenzy of home buying and the rapidly escalating prices since the
country emerged from its short-lived spring pandemic shutdown. Issi Romem, Senior
Director of Housing & Urban Economics at Zillow, and a fellow at the Terner
Center for Housing Innovation at the University of California, Berkley, explains
his different take in an article in the New York Times. Romem looks beyond the usual suspects, reasons commonly cited for the superheated
market, not totally dismissing them, but finding a few new ones to credit, or
blame, for what is going on. He also says some of the explanations given for increased
market activity are playing far less of a role than presumed. For example, he asks why the perceived
motivation of consumers to acquire more space to work and play safely which
seems to translate in a flight from urban to suburban and rural locations. This should
disturb the market balance and drive up prices. Instead, he says, should should
contribute to both supply and demand.
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