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Wednesday, April 12, 2023

Remote Work and Household Formation

by Calculated Risk on 4/12/2023 10:55:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Remote Work and Household Formation

A brief excerpt:

Back in September 2021, I wrote Household Formation Drives Housing Demand
So what is driving demand for both homeownership and rentals? Household formation!
Over time, housing economist Tom Lawler and I unraveled the household formation mystery. A key driver of household formation was work-from-home.  And this analysis has some significant implications for the housing market and the Federal Reserve (see articles at the bottom of this note).
Closed Sales Jan 2023Today, economists Adam Ozimek and Eric Carlson published new research: Remote Work and Household Formation
Another important basic fact of housing markets during the pandemic is that there was a rapid expansion of household formation. As Figure 3 shows, household formation surged 2.5% in 2021, more than double the fastest pace post Great Recession.
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