Housing Market Review and Predictions
We are now entering the post pandemic real estate market and there is a mountain of speculation what it will look like. The word “crash” is used frequently as well as “bubble”. As the economy returns to as normal as it can under the current economic and government policy, buyers and sellers will be anxious to see if there is any balancing in light of what appears to be a severe housing shortage. In this post we’ll review the 2021 housing update and prediction for the rest of the year.
2021 YTD housing market review and what’s on the horizon
A 2021 housing update shows that sellers have enjoyed a white hot market this year as appreciation has been the highest in a decade. Besides higher prices, sellers have benefited from buyers submitting offers accepting the house as-is and waive appraisal contingencies.
Housing Prediction : Rise In Homes For Sale
The scarcity of inventory or available homes for sale reached an inflection point in March where the number of properties listed began to rise. Will this continue? I believe the answer is yes for the following reasons:
- Buyer mortgage applications are at a level lower than last year. We all have to admit that last year was abnormal and buyer interest will subside to a level seen in previous years.
- Buyer Fatigue and Diminishing Affordability. When prices rise, unless wages increase accordingly, the buyer pool continue to shrink and affordability is affected. Many buyers after submitting 10+ offers and not able to get a house under contract are stepping back from the whole process.
- Federal Forbearance Moratorium is ending. This programs ends in July 2021 (unless the government decides on another extension) and homeowners
enrolled in the program will need to make arrangements with their lender to stay in the house. The issue is that 1.7 million homeowners are 90+ days past due. How many of these will ultimately need to sell will have a significant impact on housing availability.
All of these factors point to an increase in homes for sale. Whether it is a crash, bubble or leveling out with a moderate decline in prices will be determined in the next 6 months.
If you need assistance navigating this market and would like to receive homes for sale as soon as they are available, please click on Receive Homes As They Come On The Market. Or call me directly at 480-326-8571.
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