03/15/2021
Real Estate Predictions for 2021
2020 was a year full of surprises—both good and bad. Here’s the good news: real estate experts are saying that 2021 will be more predictable than last year, and their forecasts are uplifting.
We put together a survey of what’s on the horizon for 2021, featuring the state of the housing market and the best real estate investment strategies to use.
Housing Market Predictions:
Moving into 2021, what can we expect the housing market to look like? 2020 was a seller’s market with low inventory, record-low interest rates, and high demand for housing. How will these market aspects, combined with the effect of COVID-19, shape the real estate market for investors in 2021?
Look Out For A Spike In Foreclosures
Due to mass unemployment as a result of the coronavirus and a spotty recovery plan under Trump’s administration, there could be a surge in available foreclosures. If many current homeowners have been unable to pay their mortgages, these homes could be going up on the market.
When it comes to finding houses to flip, real estate investors can find great deals among foreclosed homes. These bank-owned homes are generally priced below market value because they cost banks money to hold. Therefore, they are willing to sell them quickly at below-market prices.
Expect The Demand For Housing To Continue Rising
With housing demand already high, investors might be waiting for this trend to collapse. The truth is, it’s not likely.
The Biden administration is working to dole out a number of housing initiatives, many of which will make homeownership more affordable. Between a $15,000 tax credit for first-time home buyers and down payment assistance for service workers, Biden hopes to incentivize purchasing a home. In addition, the federal government will likely attempt to keep interest rates down as the economy continues to recover from the pandemic.
These factors combined with the new shift towards at-home work will make it more feasible than ever for people to purchase homes, meaning there will be a steady stream of buyers ready to purchase from real estate investors.
The Hottest Housing Markets Are Shifting
Before investing in property in 2021, be sure to do your research on the location. Of course, this goes without saying, but some of the previously “hot” markets that have been thriving for years have recently come to a halt due to the pandemic and resulting lifestyle changes.
The new trend is that people are moving away from large cities. Here are the main reasons why:
Employees have more mobility due to remote work.
Cities are unaffordable during an economic crisis.
Cities have lost their appeal, as COVID-19 has limited the way people socialize.
So, which markets are dying, and which markets are heating up? According to Zillow’s data, there will be a surge in migration to the Sunbelt states.
In 2021, these markets are cooling down the fastest:
New York City, NY
San Francisco, CA
Los Angeles, CA
Philadelphia, PA
Minneapolis, MN
