Coronavirus Pandemic – How the Pandemic has Impacted the Major Condo Markets

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The Boston condo market has outperformed the other major condo markets, yielding an overall growth of 4.1% between 1/2019 and 7/2020. Los Angeles has been a runners-up with 2.7% during that period. Though Chicago had generated a negative return in 2019, it has remained slightly positive this year. 

Despite having a positive 2019, San Francisco has lately been falling apart. Since the pandemic outbreak in March, an exodus from the city to suburb has severely impacted the urban condo market, causing a rapid price decline. 

New York condo market, like its single-family counterpart, remains the weakest market of all the major markets, flatlining throughout this period. The positive rate in 2020 has resulted from the unexpected uptick in July.

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Since Boston and Los Angeles remained in tandem, producing positive growths in both 2019 and 2020, they exhibit very high collinearity, with a correlation coefficient of 0.97. Chicago has been in the high gear in 2020, showing the second-highest collinearity with the two frontrunners. 

NY and San Francisco have the highest negative collinearity because their performances have been diametrically opposite. Between 1/19 and 3/20, San Francisco had a decent runup, from 273.04 to 280.78, followed by a rapid downturn. On the other hand, New York was slightly negative during the first comparative period and has shown a slight uptick after that.  

Again, San Francisco's steady growth from 1/19 to 3/20 has been in lockstep with Boston and Los Angeles, resulting in moderately-high collinearity with its counterparts.

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By now, we know Boston and New York have been the best- and worst-performing condo markets. Therefore, Boston shows a very positive linear trend (with an r-squared value of 0.958, which is not shown here), whereas New York offers a sideways movement within a very narrow band of 271 to 273 (with a negligible r-squared value of 0.08).  

New York (Manhattan) and San Francisco condo markets are expected to be very volatile -- perhaps turbulent -- next year, after the current statutory forbearance expires on 12-31-2020.

Note: This analysis is based on Case-Shiller monthly condo market indices (published 09/29/2020), which are the most widely-watched and followed condo market indices in the analytics world today.

Stay safe!

Data Source: 
S&P CoreLogic Case Shiller Condo Market Indices


-Sid Som
homequant@gmail.com