The real estate market was incredible during the second half of 2020. Buyer demand was very high and the supply of available-for-sale homes hit an all-time low. The price of anything is determined by the relationship between supply and demand, which is why home prices soared last year. Dr. Lynn Fisher. Deputy Director of the Division of Research and Statistics of the Federal Agency Housing Finance (FHFA for its acronym in English), explains :
“Home prices nationwide posted the largest annual and quarterly increase in the history of the FHFA Home Price Index. Low mortgage rates, increased demand from home buyers and limited supply of homes prompted all regions of the country to experience a faster increase in 2020 compared to the previous year despite the pandemic. “
Here are the year-end home price appreciation figures from the FHFA and two other prominent indices:
- Federal Housing Finance Agency House Price Index Report : 10.8%
- CoreLogic Home Price Insights: 9.2 %
- S&P Case-Shiller S. National Home Price Index: 10.4 %
Last year was really remarkable for the owners, as prices appreciated substantially. Lawrence Yun, Senior Economist for the National Association of Realtors (NAR), revealed :
“A typical homeowner in 2020, just by owning a home, would have accumulated about $ 24,000 in home equity .”
What will happen to home prices this year?
Many experts believe that buyer demand will ease somewhat as mortgage rates are set to rise slightly. Some also believe the inventory challenge will ease as more homes for sale come on the market this year.
Based on this, most forecasters anticipate that we will see a strong appreciation in 2021, but not as strong as last year . Here are seven prominent groups and their screenings:
Home price appreciation will be strong this year, but will not reach historic 2020 levels. Let’s get in touch if you’d like to find out what your home is currently worth in our market.
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