The real estate market is facing uncertainty in the face of a global pandemic, but realtors expect a hike of 20% in the first quarter.
The COVID-19 has cast a shadow on every industry, but real estate has been affected more than most. With unemployment on the rise, ups and downs in economic trails, lockdown and stay-at-home orders, another most notable phenomenon hasbeen the low-interest rates.
The decreased interest rates have led to a record sale in the real estate market, and according to Forbes analysis, the trend has been expected to stay throughout 2021. The Washington Post analysed that the low supply and lower mortgage rates have skyrocketed the home prices, hence creating more value and wealth for homeowners.
Hold the white horse though, it isn’t all rosy. As of January 2021, The Black Night reported 5.2% of mortgages in forbearance. Roughly 3 million are in trouble, with $547 billion of unpaid principal.
The 2020 trend puts the young adults, mostly first time buyers at the top of the list to opt for homeownership. The millennials make up about 38% of home buyers whereas the National Association of Realtors, the median household income has been reported $80,000 which is a 14% hike as compared to 2019 statistics.
It is indeed the best time to sell a house, but the buyer’s affordability worsened in the last quarter of 2020. NAR chief economist Lawrence Yun predicts 21% hike in new-home sales, whereas 9% for the existing-home sales in 2021. The mortgage has been expected to rise by 3.1%.
Final Note
The coronavirus may have been ravaging the states, but the real estate market has been predicted to boom in 2021. The Redfin predicts a better economic share from real estate, and homeownership is expected to rise 69%, which is an all-new high since 2005.
