We all know that the Coronavirus pandemic took over most of the last year. That led to some unexpected and interesting developments when it comes to the real estate market. Although there was a brief period of time when home sales were low, the situation turned around pretty quickly. In fact, homebuyer activity outweighed the number of available homes all around the US. So, in 2020, people were after more space, specific home features, and affordability. But what to expect from real estate in 2021?
Nowadays, the situation is a lot different. Vaccines are widely available, and it seems that we’ll be back to our normal lives pretty soon. However, extended time at home shaped how people live every day. Additionally, many buyers changed their minds about what they want from home and where they want to live in the future. So, home upgrades that increase the resale value may look a little bit different this year.
Here are some of the trends that we can expect to see in 2021:
- Interest rates will stay low, but they’ll increase gradually.
- Average home prices will rise.
- Despite the amount of new construction, housing inventory will remain low.
- Suburbs will remain to be the most popular among buyers.
- Some renters will continue to struggle.
Today, we’ll talk about these points and what you can do about them. So, feel free to dive in.
Home values will continue to rise
According to the researches, in September last year, national home prices achieved a six-year high. This is a year-over-year increase of about 7%. However, some states saw even higher increases that went up to 12%. On the other hand, states that were hit the most by COVID saw a bit humbler growth.
This year, slower economic growth is expected to influence the price of houses negatively. So, we will see lower asking prices, but that probably won’t happen before September. We can also expect a wave of foreclosures in the middle of the year. And postponed sellings from spring 2020 to spring 2021 may increase the inventory.
All of these things could slow down housing price growth. But unfortunately, there are no definite predictions right now. Only time will tell.
Rising prices up until September is what to expect from real estate in 2021. Alt tag: Arrow pointing up.
What to do if you’re planning to sell or buy
If you want to sell a home this year, try to put it on the market as soon as possible. This will improve your chances of selling quickly, and you may even get a more decent profit.
On the other hand, if you’re planning to buy your first house, know that you’ll have less competition and more to choose from as time progresses. Luckily, you will be able to handle moving tasks without breaking the bank any time of the year, so that’s something you don’t have to worry about.
Construction will be on the rise.
Because of the COVID restrictions and regulations, lots of construction projects ended up on hold. This affected not only new construction inventory but also residential and commercial projects happening all over the country.
This year, however, many of those regulations have been removed. Therefore, construction workers are coming back to sites. This means that everything will pick up where it stopped in 2020.
Will this affect you?
As it turns out, new construction falls into two categories – luxury and 55+ developments. So, if your home is one of the more expensive ones, or if you’re in an area that is popular with seniors, you may get some competition. If this is the case, you should wonder about what to expect from real estate in 2021.
Before you decide on anything, sit down and find out if any new developments are happening in your area. Here, we’re talking about big commercial projects and event spaces. Even something that can help with health challenges people face in old age could increase the value of your home if you decide to wait.
There will be a lot of new construction throughout 2021. Alt tag: Men on the construction site.
The trend of the remote workplace might continue.
Some businesses are planning to return to their offices. However, many others realized that a virtual workforce is easier to manage and that they can save money by operating this way.
So, if you’re located near office parks or near places where start-ups are rising, you may see a decline in demand. That is if these companies decide to go fully remote, of course. Additionally, if you have once-thriving shopping areas near you, know that economic slowdown may lead to retailers leaving.
On the other hand, there’s a lot of talk about possible economic relief. So, if that happens, you can expect new businesses to flood your neighborhood. This will certainly suit your needs, but it’s still impossible to tell if that will happen. As the situation is right now, homes closer to outdoor recreation centers will be more attractive than those near office parks.
What you can do about it
As you’re probably aware, working from home changed the demands of many potential buyers. Therefore, it’s not a bad idea to stage your home in a way that will appeal to the new normal. Nowadays, home offices are a must, and you can’t sell a home without utilities like cable and internet.
Furthermore, media centers are an asset that is very sought after these days. If you have an outdoor area, make sure to pay as much attention to it as you did for the interior spaces. Outdoor media centers, pools, fire pits, comfy chairs, and smart home features will help you sell your home in no time.
If you’re a potential buyer, all of the above can be a good source of information for you as well. Areas that traditionally were affordable but have interesting things to offer will see more competition. So, make sure to read the expert tips for buying your dream home before you start your search.
A home office is something you must include if you’re planning to sell your house this year. Alt tag: Man researching what to expect from real estate in 2021 on computer.
We are all aware that the housing market isn’t simple to predict. So, no one can tell you with certainty what to expect from real estate in 2021. However, having a good real estate agent on your side will certainly help you, regardless if you’re selling or buying. Now you know what to pay attention to, so things will be easier for you.
Meta: It’s not easy to predict the housing market. However, knowing what to expect from real estate in 2021 can help you with selling and buying.