2021 Housing Market Predictions
We are officially halfway through 2021 and so far, houses have been selling like crazy. Interest rates have been historically low all year, and COVID-19 has had many homeowners on the hunt for new houses with more space to accommodate their work-from-home and online schooling situations. This has kept real estate prices high and given those selling houses the upper hand in the housing market, since people seem to be willing to pay much more than they were last year to acquire more space.
Increased Demand
However, many people whose' houses have the space that so many people are looking for aren’t exactly looking to sell-- they want that space, too! In fact, the number of houses for sale in March 2021 was 52% lower than March 2020. This makes it a sellers’ market, meaning real estate prices are likely to keep rising throughout the year.
It is also being predicted that this high demand within the housing market will lead to an increase in construction of new houses, as well, since there are less existing houses available on the market. It’s estimated that nearly 2 million homes will need to be constructed nationwide to meet the current housing demand.
Who’s Looking?
It may be surprising, but millennials are currently dominating the housing market. As of 2021, nearly 50% of millennials are homeowners, up from 40% three years ago. However, 30% of millennial homeowners said that the pandemic pushed them into buying a home earlier than expected, for the same reason that everyone else seems to want to move-- more space.
Where Is Everyone Moving?
The beginning of the COVID-19 pandemic last year had people all over the United States fleeing the cities to find more space in suburban and rural areas. But with more and more Americans getting vaccinated and COVID-19 restrictions loosening every day, previous city-dwellers are once again looking to move back to the city. However, it is being predicted that suburbs are likely to remain the main focus of the housing market for the duration of 2021.
This is likely due to lower mortgage rates and a lower cost of living, in general. Despite receiving stimulus checks throughout the past year, many Americans are just now starting to get themselves and their families back on their feet, since things like online schooling required a number of families to pay for more things like childcare and lunches that would have otherwise been taken care of by schools.
What Should You Do?
If you’re thinking about buying or selling a house, the best course of action would likely be to act as soon as possible-- houses are selling in days, even hours, in some places. If you’re interested in buying or selling a home, contact Key Realty today to get the process started!
