Summer 2021 Housing Market Update
Going into 2021, the US was still riddled with pandemic fatigue, but this still wasn't enough to slow down homebuyer activity. Low inventory of houses combined with high buyer demand has contributed to a rapid growth in house prices. This is resulting in fierce market competition throughout suburban areas. Following the rollout of vaccines to combat the ongoing pandemic, many are expecting an end to the virus in the near future.
Aside from this, some housing market trends are still expected to continue. Some of the biggest trends that are taking place throughout summer of 2021 are an increase in home inventory, revival of interest in city living (main focus still on suburbs), increased rental assistance, and a slight rise in interest rates.
Moving onto what buyers should expect this summer, coronavirus drove mortgage interest rates to historic lows this year. The interest rate rose slightly going into the spring, but in general still remains at a very low level. This combined with other factors has led to a skyrocket in demand. Many areas have become seller's markets: areas where there aren't enough purchasable homes to match the number of buyers. For reference, the number of homes was 52% lower in March 2021 than March 2020. Thus, homebuyers should expect to compete with other offers which can increase search time and drive up prices.
The answer to such a high demand in buyers is simply to build more houses. The fight to ease demand has been somewhat effective with building permits authorizing 1.68 million new privately owned housing units within the country. As the weather warms up, creating easier construction conditions around the US, buyers should expect more approved properties to appear across the market.