Updated: Jan 15
As we say goodbye to 2020, we welcome 2021 full of hope. The vaccine will be available for the public soon and that would mean more movement of the people, and also a lot of movement in the real estate market.
What exactly will happen because of this change?
People will move back to cities, especially millennials and Gen Zs. An influx of homeowners resided in the suburbs because of the pandemic. It provided a larger space for the demands of the family needs and is much more safe because of there is little or no cramped spaces.
However, some people if given the opportunity will still choose the hustle and subtle of the city life, offering a variety of choices for leisure and fun. There are two ways the real estate market will be affected by this. There will be an increase of homes for sale in the suburbs and an expected increase of demand for residences back in the city.
As a potential buyer, if you think that the city life is for you, now is the perfect time to do so before the market gets tight.
Once the vaccines are more available to the public, more homeowners who are hesitant to sell because of being vulnerable to COVID would now be more at ease in welcoming other people inside their homes for viewing.
The increase in homes in the market will be expected to happen increasingly by the second half of 2021.
Unfortunately, since the economy is already picking up, the phenomenon of hitting all-time lows of mortgage interest rates is just about over. It is not to say that mortgage interest rates will instantly shoot up, but there is an expected gradual increase of interest rates as the months pass by.
Will slow down the increase of home prices
Yes, there will still be an increase in home prices this year, but not as fast as the increase rate of last year. The increase rate will be from around 2%-6%, depending on the real estate expert and their forecast.
This increase is a result of the expected increasing demand for homes this year from those who will continue to relocate because of the changing times. This might mean others going back to the cities, or others looking for a more spacious home to fit the needs of a growing family.