Most of us would have expected the housing market to suffer from circumstances like a once-in-a-hundred-years pandemic and historic inventory shortages.
But, rather than a slowdown, we are continuing to experience a surprisingly robust real estate market across the country and experts estimate that these conditions are likely to last well into the new year.
Market conditions like fewer available listings, changing criteria for desired homes, and record-low mortgage rates are changing the way people buy and sell homes, most likely in a lasting way.
But this sustained activity, even in the uncertainty that is 2020, proves that our country still views real estate as a sound investment.
The only question now is how you can take advantage of the housing market’s “new normal.”
FEWER LISTINGS EQUALS A SELLER’S MARKET
Inventory (e.g., number of homes for sale) has been dwindling in the country’s top 100 metro markets since early 2020. It is currently about 1.47 million units, which is a decline of 19.2% from one year ago—and the lowest point since 1982.
LOW MORTGAGE RATES, BIGGER PLAYING FIELD BENEFIT BUYERS
People used to base their next home purchase on commute times and school districts. Now, thanks to the pandemic shifting the locus of jobs and work, they are free to consider how and where they truly want to live. Surveys show that quieter neighborhoods, home offices, updated kitchens, and access to outdoor spaces are preferred.
The search for these criteria is driving residents out of densely populated metropolitan areas and into the suburbs, which opens more inventory possibilities than buyers could consider pre-pandemic.
Now that 30-year fixed-rate mortgage rates dropped in mid-October, buyers are afforded the opportunity to buy nearly $32,000 more home than they could one year ago.
Similarly, a 15-year fixed-rate mortgage have dropped significantly as well. So even though home prices are high now, it’s more affordable to buy a home now than it was last year.
All of the aforementioned factors indicate that the housing market is poised to remain strong as we head into the new year. And experts believe they could “buoy the housing market for years to come.”
REAL ESTATE IS STILL A SAFE BET
Today’s housing market is competitive and strong, which makes it a sound investment for your future.