COVID-19: Impact on Apartment Demand (Webcast Summary)

To help our customers and the multifamily community as a whole through the current COVID-19 crisis, we’ve launched a series of discussions, COVID-19: Multifamily Impact and Performance Insights, centered around its impact on the rental housing industry with the latest data, expert insights and actionable measures stakeholders can take to minimize fallout.   This is a condensed summary from the first webcast in the series, COVID-19: Impact on Apartment Demand, broadcast on March 18, featuring RealPage® Chief Economist Greg Willett and RealPage VP and Deputy Chief Economist Jay Parsons.   ARE WE ENTERING A RECESSION? With the onset of COVID-19 and its economic ramifications, it feels like we’re back in 2008-2009. However, recent strength in the economy and the apartment market means that if we lose some ground from where we are now due to the pandemic, we can still land in decent shape.   The typical view now is that GDP will backtrack in 2Q. Most analysts are predicting contraction of 1.5% - 2%. However, some renowned economists are going deeper. Goldman Sachs projects a contraction of 5%.   If the spread of COVID-19 comes under control quickly, the economy is expected to stabilize in 3Q and start to grow again in late 2020 to early 2021. This wouldn’t be the first recession with a short, sharp decline and then a quick comeback in the right direction.   METROS MOST IMPACTED Local economies in tourism hot spots like Orlando and Las Vegas will struggle—where hospitality accounts for 28% of the Vegas job market and 20% for Orlando. Orange County, San Antonio and San Diego also have somewhat outsized exposure to a downturn in hospitality.   Port cities are also a concern with potential disruption of goods entering and leaving the country. The biggest port in terms of cargo moving through is along the Mississippi River, between Baton Rouge and New Orleans, where agricultural products flow from the Mid...