Housing sales and construction responses to COVID-19: Evidence from shelter-in-place and eviction moratoria in the United States

The goal of this article is to analyze the county-level impact of public policies related to COVID-19 on the housing market in the United States. Aimed at reducing the spread of the virus, different states throughout the United States enacted nonpharmaceutical interventions (NPIs) such as shelter-in-place (SIP) and eviction moratoria, in different months and for varied stretches throughout 2020 and 2021. SIP orders could potentially limit the ability of home-buyers and sellers to interact as well as they could pre-COVID, introducing frictions in the process of selling houses. Prolonged and overlapping eviction moratoria could dampen the construction of multifamily units and encourage the landlords to sell rented-out apartments. This article attempts to investigate if and how these interventions causally impacted the county-level housing sales and building permits approval in the United States. The article estimates the average treatment effect of these orders using a traditional generalized difference-in-difference estimator and a recent variation of the estimator that is more suited to multiple treatment groups with staggered treatment introductions and withdrawals. The results show that SIP is associated with significantly smaller year-on-year changes in sales of single-family houses, condominiums and the collection of all residences. Selective moratoria on eviction hearings and judgments are also found to be associated with smaller year-on-year changes in multifamily building permit approvals.