Available data show that the real estate industry generally fared well throughout the pandemic, particularly last year, with the low-interest rates of home mortgages leading to increased buyer activities in many urban and suburban areas. This is in stark contrast with the generally grim expectations of many industry players of a doomsday-like scenario as a direct result of the crisis.
With 2021 already in its second month, many are wondering if the surprisingly robust real estate industry performance will continue or if the tables will turn for the worst later in the year. The overwhelming hope of those in the real estate industry, as well as the majority of home buyers, is for the industry to perform generally well even as things gradually go back to their pre-pandemic state.
Whether you’re a licensed real estate agent or someone looking for clues on how the industry will behave this year, you should be aware of certain trends to keep you well-informed to make wise decisions. Here are the top trends that you must be on the lookout for:
Sales and prices will go up further.
According to Danielle Hale, chief economist of realtor.com, real estate sales will likely rise by 7 percent while prices will further increase to 5.7 percent from last year’s figures. These sustained increases will be fueled by continued high demands for real estate properties, low mortgage rates, and a gradually recovering economy.
The discrepancy between the high demands and low supplies (available real estate properties) will likely ignite such sustained sales and price hikes well into the end of the year and even beyond if this trend continues.
First-time home buyers won’t have it easy.
While mortgage rates are still on record lows until now, the continued high demands and low supplies of available real estate properties mean that competition will be tough, especially for first-time homebuyers. This is because they don’t have current home equity that would allow them to cover the down payment for their desired property. As such, they have to save up enough money for the down payment while acting as fast as they could once a property becomes available for buyers.
If you belong to this particular segment of the market, then you know better than to sit on the prospect of owning a great piece of property.
Digital technology will continue to play a huge part.
The year 2020 saw increased use of digital technologies such as augmented reality (AR) and virtual reality (VR) among estate agents and property developers. As lockdowns are still in place in certain areas and because many buyers prefer to hunt for available properties in the comfort and safety of their homes, such technologies will continue to shape the real estate industry in 2021.
Back in 2021, many real estate companies turned to AR and VR to roll out virtual tours of their available properties. This worked like magic as they still managed to make robust sales even amid the pandemic.
The availability of COVID-19 vaccines will benefit the housing market.
According to Lawrence Yun, National Association of Realtors chief economist, the momentum that the real estate industry had in 2020 will continue throughout 2021. He specifically mentioned that once COVID-19 vaccines get the green light for mass roll-out, more jobs will become available and would, in turn, lead to more people having the money to finance their dream home.
Ultimately, this would result in a more robust housing sector for the rest of the year and even beyond.
The remote work trend will also work wonders for the real estate market.
As more and more workers are ordered by their companies to work from home to minimize the risks of COVID-19 transmission, owning a property that is conducive for such a setup will be a dominant trend for 2021. With many office-based workers renting apartments in big cities, the idea of having a home away from the metropolis where they can remotely work in peace is definitely an irresistible one.
This will likely buoy the home-buying segment as such workers find the necessity of having a home that will allow them to become productive throughout the ongoing crisis. Additionally, this could make the suburban real estate market competitive enough to wrestle potential sales away from the traditional cream of the crop: the big city real properties.
Judging from these predicted trends, 2021 will be another promising year for the real estate industry. Whether you’re an estate agent or a home buyer trying to find out the future of the industry, knowing these trends will help you make the right moves.