We are in the middle of the most severe economic downturn since the Great Depression, with significant job losses, rising unemployment, and unprecedented government stimulus. However, both the Virginia economy and housing market were very strong going into the COVID-19 pandemic, and the Commonwealth will endure the pandemic and recession better than many other places.
Some key economic indicators in Virginia:
- Since late March, nearly 700,000 Virginians have filed for unemployment benefits. The unemployment rate in Virginia is likely to hit 15% in April.
- The biggest job losses—nearly half of all jobs lost—were in the Leisure & Hospitality sector, including jobs in the restaurant, bar, hotel, and tourism industries. Workers in the Retail Trade sector have also been hard-hit during this economic downturn.
- Households most impacted by job losses are more likely to be renters. Conversely, industries that have been relatively less impacted include workers that are more likely to be homeowners. About 44% of workers in the Leisure & Hospitality sector are homeowners, compared to 73% of workers in the Professional & Technical Services sector.
COVID-19 Has Impacted Renters More Than Homeowners
- National Gross Domestic Product (GDP) declined by 4.8% in the first quarter of 2020. Economists forecast that GDP could decline by 30% in the second quarter of 2020 before beginning to recover in Q3 and Q4.
- Employment and demand for housing in Virginia will recover, with some parts of the market recovering earlier than others. The for-sale market should rebound early this summer while the rental market could feel the impacts of the economic downturn for a longer period of time.
Virginia REALTORS® continues to monitor the impact of COVID-19 on U.S. and statewide economic and housing market trends. Check back frequently for updates, and reach out if you need any more data or information.