The COVID-19 crisis changed every aspect of American life. The property/financial-data analysts at CoreLogic examined how, specifically, the pandemic affected real estate and the housing economy in 2020 and how the industry's response to sudden challenges is likely to shape the coming year.
In its white paper entitled, "Modernizing the Housing Economy [1]," CoreLogic addressed the myriad ways the health crisis has been "a catalyst for change."
"The pandemic is challenging the real estate, lending, and insurance industries to set new standards on safety, as well as to effectively manage the property ecosystem—to think differently and embrace the disruption as an opportunity for change," the authors said. "While many of the ripple effects of COVID-19 have been, and continue to be, devastating for so many, it has also demanded a paradigm shift for the better within the real estate, lending, and insurance spaces."
The authors go on to conclude that many technological advancements made in response to the crisis will be "permanent industry changes, ultimately reshaping the way the real estate ecosystem conducts business."
For example, national health guidelines related to COVID-19 made digital homebuying solutions essential.
Video volume and 3D model usage were up 141% and 76% respectively compared to 2019, CoreLogic reported, and its own PropertyAssist has completed more than 10,000 virtual appraisals since April. Researchers say to expect these investments to continue to grow in 2021 with the resurgence of COVID-19 cases.
CoreLogic's study showed that, despite a blip in April, purchase mortgages in 2020 rose to their highest levels in 15 years—and purchase and refinancing originations are at the highest level ever. However, the researchers noted, with persistently high unemployment, serious delinquencies are expected to rise 4x by November 2021, which would account for more than 2 million homeowners falling into delinquency.
"With the looming end to forbearance periods, we should see a continued investment in loan modification solutions," noted the authors, who go on to detail challenges—including safely showing homes on the market, verifying employment and income (with so many working remotely), safely appraising homes, addressing "hidden" Homeowners Association (HOA) and Condo Owners Association (COA) liens, and insurance inspecting in a pandemic—and offer technological solutions through its new homebuying/selling tools.