Eye on Housing Covid Era Imacts on Working from Home and Housing Market Impacts

COVID ERA IMPACTS ON WORKING FROM HOME

and Housing Market Impacts

While the COVID-19 pandemic has triggered many social and economic disruptions, it has also changed working arrangements and has accelerated the shift to work from home (WFH). During the COVID-19 outbreak in the early of 2020, many businesses across the United States closed and millions of workers experienced the work from home trend out of necessity. This sudden and massive work from home experiment generated major lifestyle changes for workers, homeowners, business owners, and our communities.

A new NBER working paper, “Working from Home Around the World1,” provides some insight into the big shift to WFH and discusses implications for workers, organizations, cities, and the pace of innovation. The study surveyed full-time workers who finished primary school in 27 countries as of mid-2021 and early 2022 and found strong support for a three-part explanation of how and why the pandemic catalyzed the big shift to WFH. The pandemic has driven a mass, compulsory social experiment in WFH, which generated a tremendous flow of new information and greatly altered perceptions about the feasibility and productivity of WFH. Individuals and organizations have re-optimized accordingly and allowed much more WFH days than prior to the pandemic.

The NBER paper also examined WFH levels during the pandemic, people’s plans, and desires to work from home. It stated that full WFH days averaged 1.5 days per week across 27 countries, and employees wanted more WFH days than employers’ plans in every country after the pandemic. Moreover, it presented that people placed a sizeable value on the option to WFH a few days per week, as WFH saved time and costs of commuting and grooming and provided more flexibility in time use over the day. Specifically, the study concluded that employees valued the option to WFH 2-3 days per week at 5 percent of pay, on average, with higher valuations for women, people living with children and those with longer commutes.

Additionally, when this study investigated post-pandemic WFH levels, the results showed that employers’ plans for WFH levels after the pandemic correlated strongly with WFH productivity surprise gains during the pandemic. Across different countries, there was evidence that planned WFH levels rose with the cumulative stringency of governmentmandated lockdowns during the pandemic. However, there was no evidence that cumulative COVID death rates affected employers’ plans for post-pandemic WFH levels or current WFH levels.

BY: JING FU

While “the big shift to WFH presents especially acute challenges for dense urban centers,” it also had a significant impact on the housing market as WFH has enabled homebuyers to relocate to low-density areas that have higher housing affordability conditions. The most recent analyses of NAHB Home Building Geography Index (HBGI) showed that home building activities have shifted from higher density core areas to low-density and low-cost markets since the beginning of the COVID-19 pandemic. The analyses also indicated that the market share of singlefamily and multifamily construction in large metro core and inner suburbs dropped in the second quarter of 2022, compared to the fourth quarter of 2019 (pre-COVID).

WFH does not only change where we work but also where we live. Homebuyers with WFH options have more choice when they choose where to live. As homebuyers are looking to relocate to low-density areas (residential outmigration), many populous urban areas have experienced especially large declines for inward commuting. Consequently, WFH has raised the preference and attractiveness of the suburban and exurban living and reshaped the housing market in many remarkable ways.

ITS TIME TO

Get Out And Vote

The right, election day is upon us. With early voting citizens can visit their election board vote or start mailing in their choices. The continuous ads on TV, radio and political pieces placed in your mailbox continues too. In select neighborhoods, candidates and their volunteers will be visiting with lit drops and the like. While it’s not a presidential year, much is at stake.

Headlining offices up in Ohio begin with the governor. The governor holds vast power and has great influence over the regulatory mechanism statewide. Next is likely the open US Senate seat. While there are100 US Senators, the open Ohio seat could be the deciding vote to control the Senate. With a democratic president for two more years, that extends a lot of power. The obvious concern is if vacancies open up on the US Supreme Court. As of today, the polls show a dead heat. Most around the nation’s capital expect republicans to retake control of the House, not so sure about the Senate.

Likely the biggest concern for the business community in Ohio is control of the Ohio Supreme Court which could be affected by the winners. The business community has been favored in some high visibility tort and tax issues. Still brewing however are how legislative districts are drawn. Essentially, the current maps have been adjudged unconstitutional, but a Federal Court has authorized them to proceed for this election cycle only. Whoever controls the court next year will determine which parties favored districts will prevail for the ensuing eight years.

We have done well with the current majorities in both the Ohio House and Senate. Currently, there is no indication that party control will change. The big issue now who; will be the eventual Speaker as current Speaker Bob Cupp is term limited. Behind the scenes politicking has been in the works for months to win the Speaker’s chair when the new assembly is seated in January.

by Vincent J. Squillace, CAE, OHBA Exec. VP