Real Estate Marketing & Beyond
The recent revelation that Americans are having fewer children during the COVID-19 pandemic is likely to have some big implications for the U.S. housing market, causing new trends that are apparent even now.
In a post on the National Association of Realtor’s Economists’ Outlook blog, Dr. Jessica Lautz, vice president of demographics and behavioral insights at NAR, said the “baby bust” trend is expected to continue even after the pandemic subsides.
Last week it was reported that the U.S. fertility rate fell by 1% in 2019, reaching an all-time low compared to the previous century. Worse, that trend is visible across all racial groups, with the fertility rate for non-Hispanic white women falling 2%, black women 1% and Hispanic women 1%, Lautz said.
“This trend has significant implications for home buyers,” Lautz said. “What is important to a buyer with children will be different than what a buyer needs without children in the home.”
She notes that home buyers with children will have a high priority on location and nearby schools, as well as the size of the home. Buyers with children will purchase a four-bedroom home with 2,200 square feet of space on average, whereas those without children look for smaller homes, typically a three-bedroom property with 1,800 square feet of space, according to NAR data.
The news that the U.S. fertility rate had fallen was met with surprise, as many had expected to see a baby boom during the pandemic. However, Lautz said that one of the reasons for the fertility rate drop was the impact of the pandemic on people’s finances. She added that she expects fertility rates to remain low even after the pandemic, due to its financial impact.
She pointed out that working mothers have left the workforce at higher rates than fathers during the pandemic, due to an increase in household demands and a decrease in available jobs in the service sector, where women are over-represented.
Lautz said the result is that many women are experiencing more strained finances, while the increased household demands have dampened any desire to have more children. In addition, she said that some women might have concerns about giving birth during the pandemic, as the required doctor and hospital visits would increase their risk of being exposed to COVID-19.
