WHAT IS THE REAL ESTATE MARKET GOING TO DO IN 2021?
When the pandemic hit, all eyes turned to the housing industry. Everyone we know was holding the collective breath. After months of a rapid fire sellers market with prices inching up on the daily-would we see the bubble burst? Worse yet, would it throw us into a recession similar to what we experienced in 2007?
Fortunately for all of us, that was not what happened. While we had a few months of slow down, the home values did not falter at all-quite the opposite. As concerned sellers left the market, stalwart buyers remained and the competition and demand for homes pushed the prices up even more in most areas.
So what can we expect this year?
The expectation is that home sales continue to move at a swift pace. Fall was the new spring in 2020, but the inventory was at record lows which means there are a lot of sellers that are likely to return to the market. Additionally, the incredibly low mortgage rates are still in play and are enticing not just for first time home buyers, but for sellers that want to take advantage of the increased buying power low rates affords them.
As we get into the warmer months of 2021 we will see another uptick in purchases. Rates are predicted to rise and that is expected to urge buyers who have been hesitating off of the fence.
Regardless, Realtor.com tells us to expect a 7% increase in sales over 2020 based on the anticipated return of Sellers to the market and the expected arrival of the Covid 19 vaccine giving a boost to consumer confidence and spending.
Home prices rose in many areas locally and nationally-in some markets at much as 15%. The pressure of low supply vs. high demand is expected to keep prices elevated, at least until the cautious sellers of 2020 return in full force and tip the scales once again. Inventory is expected to improve and hopefully increase in 2021. As many Realtors and Buyers can tell you, it was a tough market to purchase a home in the last few months, with many of us relying on word of mouth and coming soon listings to fill the needs of our frustrated Buyers.
We are told that ‘trade up’ movers will be one of the segments to watch, those folks that have owned their homes for more than a few years and have seen their equity rise with the home values locally. With jobs feeling more stable and less families tied to the proximity of their offices, many families are considering making the leap to their dream home. The ability to work from home, now a permanent change for many-opens up a whole new market when shopping for a house! Suburban areas are seeing a heyday as workers are able to move around with no regard for commuting time. Office or flex space has moved to the top of the must have list knocking out big owners suites and gourmet kitchens.
Overall 2021 is looking good and we are excited to welcome it in! If you have questions about your home, let us know! We’d love to chat! Thinking about buying in the new year and wondering how to prepare? Let’s talk!
And together let’s make this your year!
Sources
https://www.realtor.com/research/2021-national-housing-forecast/