Did you know that there was a 22.9% increase in real estate home sales this last year? It’s one of many records that the real estate industry has hit recently, and it shows no sign of slowing. Low supply and low mortgage rates have both been strong contributing factors to this trend.
2020 and 2021 have been tough years for many industries, but what does the next year hold for real estate? If you were thinking about buying a home, now is the perfect time to learn more about the market before you dive in. Check out these real estate predictions here first.
Selling a home has never been easier since sales have been rising, and prices have, too. Home prices have risen 13.2% this year compared to last year, making it a seller’s market. This marks the first indication that next year will be more of the same.
Supply vs. Demand
The pandemic created a unique situation where many households switched from working from an office to working at home. This created a demand for real estate as renters purchased homes, and existing homeowners bought larger homes or left urban areas for the suburbs. The volume of potential buyers exceeded the housing supply available, creating a boom that shows no sign of slowing down.
Rising Lumber Prices
Another key factor has been the rising cost of lumber. This, in turn, has increased the cost of new home builds, pushing it out of many people’s price range. Because of that, existing homes have become more desirable and have created a competitive market for that.
Low Mortgage Rates
One of the biggest indications of the future of real estate is found in historically low mortgage rates. The most recent stats on 30 year fixed mortgage rates show 2.77%, which have decreased in the last quarter. This means already attractive low rates this year have dipped even lower, which could continue to make purchasing homes a trend.
Real Estate Predictions for Next Year
The temptation is too great for buyers to take advantage of these historic mortgage rate lows, meaning the buying boom will continue. As the pandemic continues and the population continues to adjust, adapt, and migrate to new areas, the industry should be tight. You can always contact real estate professionals like the ones on this site for more detailed insights into the local market in your area.
Learn More About Real Estate Today
Now that you’ve learned all about the real estate predictions for next year, you can feel more confident about joining the market. If mortgage rates remain low and demand continues to stay high, the market should remain tight. Be sure to watch these trends and do your research to make a good investment!
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