The housing market will help the United States economy recover from its current recession, like it has numerous times during the last 50 years.

That’s the theory proposed by Daniel McCue, senior research associate for the Harvard Joint Center for Housing Studies in his blog post, “Housing Could Help Lead the Post-COVID-19 Economic Recovery.” Recessions lead to lower interest rates, which reduce costs for home buyers and builders and lead to greater interest in buying and building, says McCue, citing research by economist Edward Leamer.

A key difference between the current recession and the Great Recession, says McCue, is that the percentage of distressed and foreclosed properties is lower than its been in decades. For example, in the first quarter of 2020 the U.S. had 2 million fewer vacant housing units, than in the fourth quarter of 2007, even though 12 million units had been added in that 12-year period.

He uses data compiled by economists Michael Bordo and Joseph Haubrich as well as former Fed Chairman Ben Bernanke in this blog post.

To find out more details about McCue story, including several easy to read graphs, read the entire blog.