Reproduced from CivicScience; Chart: Axios Visuals

The housing market has been a solidly bright spot in the U.S. economy in recent months.

Yes, but: There remain serious questions about what the next phase for the market will be as the coronavirus pandemic has created an enormous amount of uncertainty about where and how people will live.

Driving the news: The National Association of Home Builders reported that confidence among builders jumped to its highest level ever this month, as Americans have rushed to take advantage of record low interest rates

  • “The demand for new single-family homes continues to be strong, as low interest rates and a focus on the importance of housing has stoked buyer traffic to all-time highs as measured on the HMI,” NAHB chairman Chuck Fowke said in a statement.
  • “However, the V-shaped recovery for housing has produced a staggering increase for lumber prices, which have more than doubled since mid-April. Such cost increases could dampen momentum in the housing market this fall, despite historically low interest rates.”

Be smart: Average home prices have risen to record levels, concerning economists who worried prices were already unsustainably high.

On the other side: Commercial rents and property values are declining and significant uncertainty hangs over the market.

  • The Green Street Commercial Property Price Index has declined by 15 points since February with average prices falling by around 10%, says Peter Rothemund, managing director at Green Street Advisors.
  • "[I]t’s pretty clear that the range of outcomes is going to be wide," Rothemund said in a recent blog.
  • "Record-low interest rates mean properties with a stable top-line outlook will hold up well. Those with some risk, say multitenant office, probably see something like a 10% hit on average. And those with a lot of hair, like lodging and some retail, lose even more.”

One level deeper: Investment in commercial real estate in the Americas region saw a 70% decline year over year to $43 billion in the second quarter, the lowest since 2010, according to CBRE.

What to watch: While realtors say home buyers are flocking to the suburbs, new surveys from CivicScience find that suburbanites are just as likely as city dwellers to be considering a new residence.

  • Ultra-expensive cities like New York and San Francisco are seeing inhabitants depart and rents decline. Economists expect more young people to settle in less expensive cities, but none have yet emerged as the clear destination for the expected work-from-home exodus.
  • 32% of respondents said they would move to a different city if offered the opportunity to permanently work remotely, but 30% were unsure and 38% said they would not move.

Go deeper

Dion Rabouin, author of Markets
Oct 19, 2020 - Economy & Business

Short sellers are rushing back in

Data: S3 Partners; Chart: Axios Visuals

With the stock market again rising toward record highs, short sellers are moving back into technology shares and broad U.S. indexes with increasing confidence, betting that prices will fall and they will profit.

What's happening: After largely cashing out their bets at the end of the first quarter following the market crash in late March and pulling back in July and August, the renewed rise in stock prices has bears upping their bets again.

Updated 38 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Politics: Ex-FDA chief: Pence campaigning after COVID exposure puts others at risk — Mark Meadows: "We are not going to control the pandemic"
  2. Health: 13 states set single-day coronavirus case records last week — U.S. reports over 80,000 new cases for second consecutive day.
  3. World: Australian city Melbourne to exit one of world's longest lockdowns — In photos: Coronavirus restrictions grow across Europe
  4. Media: Fox News president and several hosts advised to quarantine after possible COVID-19 exposure
  5. Nonprofit: Rockefeller Foundation commits $1 billion for COVID-19 recovery
Updated 42 mins ago - World

In photos: Coronavirus restrictions grow across Europe

A skeleton is placed at a restaurant table in Rome to protest Italy's restrictions that'll see gyms, movie theaters and pools close and bars and restaurants required to shut by 6 p.m. until at least Nov. 24. Photo: Antonio Masiello/Getty Images

Restrictions are returning across much of Europe as the continent faces a second coronavirus wave.

The big picture: Spain and France each surpassed 1 million cases last week, and both countries have implemented further restrictions on citizens. Italian officials announced strict new measures, effective Monday, to combat another cases spike. From Denmark to Romania, take a look at what steps countries have been taking, in photos.