Despite everything, the housing market was one sector of the economy that performed consistently well throughout 2020. What do experts think this coming year will bring? Here are four trends to watch out for:
1. Prices will continue to rise. If inventory remains as low as it has, it’s possible that prices will continue to go up. The median sold price for properties in our area was $315,000 this year—a 6.8% increase compared to 2019. Inventory also further declined by 26.3% year over year. Despite a quick burst of new listings toward the end of the summer (perhaps due to a delay in the market caused by the pandemic), a dwindling supply of houses is great news for sellers but not so much for buyers.
2. Suburbs will reign supreme. We talked about this trend early this year, and it looks like it will continue. As more and more folks find out that it’s easier for them to work remotely or that proximity to where they work isn’t as important, they’ll look to buy homes farther and farther away from city centers. Many people are starting to look toward neighboring counties or smaller communities where they can get a bigger bang for their buck.
3. Increased builder confidence. Builders are becoming more confident in their futures, and we’re now seeing more and more new construction starts happening than we’ve seen in the past few years. Also, buyers who aren’t finding what they’re looking for in the resale market are turning to the new construction market as an alternative to find a home that fits their needs.
4. Mortgage rates will remain low. Mortgage rates hit several record lows throughout 2020, and this trend seems likely to continue—at least during the early part of 2021. Historically low rates have brought buyers out en masse, which has caused low inventory, rising prices, and a flurry of activity. We’re no longer seeing a seasonality in our market. Instead, buyers are buying when they need to buy and sellers are selling when they need to sell. Buyers, especially, are trying hard to capitalize on these low mortgage rates.
As always, if you have questions about our local real estate market or there’s a topic you’d like to see me cover in a future video, call or email me anytime. I’d love to speak with you.