2021 Could see this continued pattern
Being that we are now far into Q4 of 2020 and the end of the year is approaching, some have wondered what the effect of this year’s events would have on home prices. For years now we have seen a pattern of steady increases in prices and despite all that has occurred this year we can look to the laws of supply and demand to provide us with the most accurate idea of what to expect.
There is still a significant lack of available homes on the market for sale which is applying pressure on prices and driving them up. This fall we have seen extremely low mortgage rates which only has helped fuel more buyers to get active with their property searches. This has caused bidding wars on properties which has driven up higher prices for homes.
There have not been any signals that the buyer demand will let up at any point in the near future. Therefore some experts are projecting that home prices will most likely keep increasing over the next year.
According to a recent report there have been reports from various sources that speculate home price appreciation trends. CoreLogic anticipates on the low end of 0.2%, the National Association of Realtors notes a 4.3% increase while Zillow is the most aggressive at 7%.
Some have shared thoughts that we may see a small surge in foreclosures from those who entered a mortgage forbearance plan. However, with demand so high and supply so low it is not likely that we will see a true foreclosure crisis. Ivy Zelman, CEO of Zelman & Associates who is a notable expert in housing and the industry recently stated, “The likelihood of us having a foreclosure crisis again is about zero percent.”
In sum as we near the end of 2020 many of us would have guessed that the pandemic would have created a decline in the real estate market. However, on the contrary home sales have continued to do quite well and home prices have continued to rise. Experts are saying we can expect to see this trend carry well into 2021.