Nothing short of miraculous: The housing market continues to hold up

New York(CNN Business) The coronavirus outbreak hasn't made a serious dent in Americans' willingness to buy new homes or fix up their current houses.

The housing market experienced a downturn shortly after the Covid-19 pandemic ground much of the US economy to a halt in March and April. But buyers are back, looking for homes — and that's helping to lift the stocks of builders, retailers and home goods suppliers in the process.

Shares of Home Depot (HD) are up nearly 15% this year, making it the third best-performing stock in the Dow in 2020. Home Depot is trailing only Microsoft (MSFT) and Apple (AAPL). Home Depot rival Lowe's (LOW) is up nearly 10% as well.

Homebuilder Lennar (LEN) is up 15% this year too. The company reported its latest earnings after the closing bell Monday and executives expressed hopes that the worst is already over for the housing market.

Lennar executive chairman Stuart Miller said in the company's earnings release that "business rebounded significantly in May...and this rebound has continued into the first two weeks of June."

Despite the spike in unemployment that has occurred during the pandemic, Miller noted more Americans are taking advantage of low mortgage rates since the Federal Reserve has cut interest rates to near zero levels.

"While many parts of the economy are still waiting to open and rebound, the housing market has proven to be resilient in the current environment," Miller said. "We expect this trend to continue and for housing to be a significant driver of employment and rebound for the broader economy."

Building boom coming?

Lennar isn't the only builder feeling more bullish.

The National Association of Home Builders reported a surge in its builder confidence index for June on Tuesday. Another report from property condition data firm BuildFax on Tuesday showed that "an increase in construction hiring suggests slowdowns in housing activity may be short-lived."

The building boom could gain momentum as the summer goes on, said Jesse Singh, CEO of Azek, a company that makes decks, patios and other outdoor furnishings from non-wood composites. Azek went public on Wall Street Friday and the stock has gained nearly 30% since then.

Singh told CNN Business that his company is seeing strong demand for its products from both existing homeowners looking to do repairs to the exteriors of their houses as well as builders that are starting to go back to work.

"We're appropriately cautious but as more areas open up their economies, the demand is there," Singh said, adding that sales are picking up at lumberyards as well as retailers like Home Depot and Lowe's.

Buyers coming back to the market

Online housing data company Zillow (Z) just announced it's planning to resume buying homes in markets where it sees good opportunities to purchase houses and resell them.

Real estate brokerage firm Redfin (RDFN) has recently said it has noticed a turn for the better too. The company said seasonally adjusted demand for homebuying during the first week of June was 25% higher than it was before the pandemic hit earlier this year. Mortgage applications are rising as well.

New listings are recovering, which is putting more inventory on the market. But bidding wars are starting to emerge for housing as well -- even with more supply.

Redfin said nearly 50% of offers it worked on faced competition in May, up from about 44% in April.

"Homebuyers felt they were starting to get more clarity around where the economy was headed, with cities around the nation lifting stay-at-home orders. This gave house hunters more confidence to compete," said Redfin lead economist Taylor Marr in a report Monday.

Demographics could fuel a further boom as well, said Gina Szymanski, portfolio manager for the real estate investment trust group at AEW Capital Management.

Szymanski said that demand for manufactured housing is picking up with older baby boomers looking to retire and sell their existing homes. Moving to a city is less desirable now, but so is having a giant house in the suburbs that requires a lot of upkeep.

"You may not want to live in an elevator building or dense urban area but you don't want a large property either," Symansmki told CNN Business. "Manufactured homes have lower prices and good value."

And more Americans may look to leave big cities to buy larger homes in less densely populated areas.

"People will be looking at the suburbs and reimagining what work life is like," said Nela Richardson, an investment strategist with Edward Jones and former chief economist at Redfin.

Richardson told CNN Business that consumers with the financial resources to do so are also starting to consider buying second homes for vacations.

The reason? More control over cleaning, which makes a second residence a potentially safer place to go to than a hotel or resort.