To determine the cities on the verge of a COVID-19-driven housing crisis, 24/7 Wall St. constructed an index composed of the change in median home sales price, housing affordability, unemployment, industry risk analysis, and other measures of housing market health.
Data on the change in median home sale price from Q1 2010 to Q1 2020 came from ATTOM Data Solutions and was included in the index at full weight. Data on the number of distressed sales — which includes real estate-owned sales, short sales, and foreclosure auction homes sold to third-party buyers — as a percentage of all sales in Q1 2020, also from ATTOM, were included at half weight. Data on the number of “seriously underwater” mortgages as a percentage of all outstanding mortgages in Q1 2020, and the number of foreclosure filings as a percentage of all housing units in Q1 2020, both from ATTOM, were included in the index at half weight.
Data on the unemployment rate, seasonally adjusted for March 2020, came from the Bureau of Labor Statistics and was included in the index at half weight. The percentage-point change in unemployment from March 2019 to March 2020 was included in the index at full weight. We calculated the ratio of median home value to median household income using data from the U.S. Census Bureau’s 2018 American Community Survey (ACS) as a proxy for housing affordability and included it in the index at full weight. Data on the percentage of employment in high-risk industries was calculated using data from the BLS 2018 Quarterly Census of Employment and Wages and COVID-19 industry risk analysis from the March 2020 paper, “COVID-19: A Fiscal Stimulus Plan,” published by Moody’s Analytics, an economic research firm. Finally, data on the number of confirmed COVID-19 cases as of May 12, 2020, gathered from state and local health departments were aggregated from the county to the metropolitan level, adjusted for population using five-year data from the 2018 ACS, and were included in the index at full weight.