2020 sure has sure been a roller coaster year for us all no matter which industry you are in. That is especially true when it comes to the real estate industry. Every real estate agent has indicated that big changes are coming to the real estate market. Charla Coleman, a real estate agent at Coleman Group, recently said, “The events that occurred in 2020 will have a drastic effect on what is to come in 2021.”
Whether you’re thinking about buying or selling a home, it is vital to know what you can expect in 2021. This article will help us all understand how 2020 has impacted the housing market. It will also help us know what to expect in the real estate market in this new year. Let’s dive in, shall we?
How Predicted 2020 Real Estate Trends Changed
Going into last year, there was the expectation that the real estate market would see slow but steady changes. Home prices were expected to rise but at a slower rate compared to previous years. At the same time, housing inventory was expected to improve slowly from previous times when there was a housing shortage. Small starter homes were expected to be the homes that are the most in-demand. That is indeed the case among Millennials who would also be enjoying low-interest rates.
When the COVID-19 pandemic escalated in March, the real estate market took a drastic turn. With economic shutdowns due to the concerns about the virus, the housing market slowed despite the low-interest rates. This economic uncertainty kept people from buying houses. Fannie Mae predicted a 15% drop in home sales for 2020 compared to 2019. This led to a softening in housing inventory decline along with a drop in house prices. Buyers who worked from home benefited the most from this scenario.
What Real Estate Trends Can We Expect In 2021
You are likely wondering what we can expect out of the real estate market in 2021. For one thing, we expect a much stronger year to come. First off, we expect mortgage rates to stay relatively low not only in 2021 but also for a long time. With that said, it might slightly increase once COVID-19 vaccines are widely available.
We also expect a drastic increase to start the year but as more people become vaccinated, home prices will ease. Older homeowners who held off on selling due to pandemic concerns will be encouraged to post their home listings. This will help increase the inventory of homes which helps ease home prices in return. It is predicted that 2021 price growth rates will be between 2.1% and 5.7%.
Millennial demand for homes is expected to continue its hot streak. They’re expected to tally at least 15 million home sales in the next ten years. With the expected increase in the savings rate, the home sale figure could turn out to be even more. This is especially the case when it comes to suburban areas. Expect suburbs to continue their hot streak in 2021 with no signs of it slowing down any time soon.
Real Estate Market Is Set For Growth Going Forward
Without question, the real estate market is expected to grow in many diverse ways whether you’re a buyer or seller. With that said, it is crucial to have a plan on how to navigate this competitive housing market. This sure is something to think about when considering a real estate agent like those at Coleman Group. In places like the Boston area, this is essential in helping you succeed in finding the right home for you.