The year 2020 is certainly memorable, with new realities and norms that have changed our way of life. This year’s real estate market is certainly no exception to that change, with historical highs continuing to break records and challenge what many thought was possible in the housing market. Here are four main areas that will fundamentally define the market this year.
Recovery of Houses
The economy was intentionally paused this spring in response to the COVID-19 health crisis. Many aspects of the joint real estate transaction were halted at the same time. Fortunately technology and innovation helped the industrial power move forward, and business gradually grew back when shelter-in-place orders were suspended.
The result? Total transformation of the market from low lows to exceptional highs. Today, the restoration of housing is called truly remarkable by many experts and far exceeds expectations. De pending home sales al buy applications, buyers trade again and homes sell – fast.
According to the Housing Recovery Index of realtor.com, the market has surpassed pre-pandemic levels, and has regained the strength we remember since February of this year (See graph below):
Record Mortgage Rates
History low mortgage rates are another 2020 change. Today’s low rate is one of the big motivating factors that is bringing buyers back to the market. The average rate has reached an all-time low several times this year, and it continues to hover in record low territory.
When rates are so low, buyers have a huge opportunity to get more for their money by buying a home, which many want to find while continuing to spend. more time than expected at home this year, and probably beyond.
Ongoing Home Price Gratitude
One of the key drivers of a home price this year is historically low inventory. Inventory has been low in the pandemic, and it still sits well below the level needed for a normal market. Although sellers are slowly returning to the game, buyers are collecting homes faster than they are for sale.
This is a classic scenario of supply and demand that forces home prices to rise. Selling something when there is a higher demand for what is available naturally raises the price. If you’re ready to sell your house today, this may be the best time to move on. Like Bill Banfield, EVP of Capital Markets at Speed Up Loans, notes:
“The pandemic did not stop the consequent rise in house price we have testified in recent years. ”
Even as house prices continue to rise, affordability works in favor of today’s homebuyers. According to many experts, these low rates offset rising home prices, which increases purchasing power – an opportunity not to be missed, especially if your family’s needs have changed. If you now need space for a home office, gym, virtual classroom, and more, it may be time reconsider your current house.
According to Mortgage News Daily:
“Those who buy a home can pay 10 percent more for a home than a year ago, while keeping their monthly payment unchanged. This translates to almost $ 32,000 more purchasing power.”
With mortgage rates hitting historically low values, house prices higher, affordability rising, and the market recovering like no other, 2020 has been quite a year for real estate – perhaps one we’ve never seen before and may never see again. Let’s connect today if you’re ready to take advantage of this year’s record-breaking opportunities.
Content previously posted in Keep Current Things