5 Expert Views on the 2021 Housing Market
The housing market was a shining star in 2020, fueling the economic turnaround throughout the country. As we turn our attention to 2021, can we expect real estate to continue showing such promise? Here’s what four experts have to say about the year ahead. As somebody who follows our local market extremely closely, I'm lending my personal thumbs up to each of these broader opinions.
Lawrence Yun
Lawrence Yun, Chief Economist, National Association of Realtors (NAR)
“In 2021, I think rates will be similar or modestly higher, maybe 3%…So, mortgage rates will continue to be historically favorable.”
More at NextAdvisor.
Danielle Hale
Danielle Hale, Chief Economist, realtor.com
“We expect sales to grow 7 percent and prices to rise another 5.7 percent on top of 2020’s already high levels.”
Robert Dietz
Robert Dietz, Senior Vice President and Chief Economist, National Association of Home Builders (NAHB)
“With home builder confidence near record highs, we expect continued gains for single-family construction, albeit at a lower growth rate than in 2019. Some slowing of new home sales growth will occur due to the fact that a growing share of sales has come from homes that have not started construction. Nonetheless, buyer traffic will remain strong given favorable demographics, a shifting geography of housing demand to lower-density markets and historically low interest rates.”
More at Forbes.com.
Mark Fleming
Mark Fleming, Chief Economist, First American
“Mortgage rates are expected to remain low for the foreseeable future and millennials will continue forming households, keeping demand robust, even if income growth moderates. Despite the best intentions of home builders to provide more housing supply, the big short in housing supply will continue into 2021 and likely keep house price appreciation flying high.”
More at FirstAm.com.
Bottom Line
Interest rates will stay low, but inevitably will rise. The timing depends on the strength of our market. We should all want to see rates rising because that means our economy is growing.
Home sales will continue to be strong, but inventory will continue to be an issue as new home builders struggle to catch up. Here in Silicon Beach, new construction is less of an influence because we're pretty much built out, which means even more supply constraint. Constrained supplies drive prices up.
Source: Simplifying The Market
Want to strategize about your own plans to buy or sell in 2021? Grab a convenient time on our calendar.