According to many experts, the real estate market is expected to continue to grow in 2021, and it is largely driven by the lasting impact the pandemic is having on our lifestyles. As many of us spend extra time at home, we reevaluate what “home” means and what we may need in one go.
Here are 4 reasons why people are considering where they live, and why they expect to buy a home this year.
1. Record-Low Mortgage Interest Rates
In 2020, the average interest rate for a fixed-term mortgage of 30 years reached a record low 16 times, continuing to decline below 3%. According to Freddie Mac, the average 30-year fixed interest rate standard is today 2.65%. Many wonder how low these rates will go and how long they will last. Len Keifer, Deputy Chief Economist by Freddie Mac, advises:
“If you’ve found a home that’s right for your needs, at a price you can afford, it might be better to act now than expect future rate declines that may never come, and a future that probably has a very strict inventory.”
This sense of urgency is driving many to buy this year.
2. Working from Home
Remote work is a new standard for many companies, and it lasts longer than most expected. Many in the workforce today are discovering that they no longer need to live close to the office and they can get more for their money by going a little further outside the city limits. David Mele, President at Homes.com, says:
“The increase in the home population has rewritten the playbook for many decisions about buying and renting homes, from when and where to relocate, to what people are looking for in their next home.”
The reality is that some people work far away in their current home hard, especially when there may be other possibilities.
3. More Outdoor Space
Another new priority for homeowners is to have more usable outdoor space. Being at home pushes those in some areas to look for less densely populated neighborhoods, so they have more space to extend their legs. In addition, those who live in apartments and townhouses are often looking for an extra square image, inside and out.
According to the State of Domestic Expenditure report of HomeAdvisor, of the households surveyed, nearly half reported spending 27% more on outdoor living over the past year. This trend is expected to grow in 2021 and beyond.
4. Avoid Renewals
Recently it has emerged that many homeowners would also rather buy a new home than deal with the process of repairing the one they have. According to the 2020 Profile of Home Buyers and Sellers report the la National Association of Real Estate Agents (NAR), 44% of homebuyers bought a new home to “Avoid renovations or problems with the plumbing or electricity.”
Depending on what is being handled, today’s high buying demand may make it possible to omit some renovations before selling. Many of these homeowners have prioritized buying over renovating for ease and potential savings.
It is clear that homeownership needs are changing. As a result, Americans are set to move on record this year. If you’re trying to decide if now is the right time to buy a house, let’s connect today to discuss your options.
Content previously posted in Keep Current Things