If you’ve been keeping watch of our posts on the market update per area, you might be confused with the different paths each area is doing.
In some places, more listings are sold over a shorter period of time, while in another less listings are sold with longer average days on the market.
Even though no one can exactly know what can happen in the next half of 2021, we can look at the numbers. After all, numbers do not lie.
Let’s also look at what experts have to say regarding the housing economy.
Mortgage will increase, but comparatively low
One thing is sure, mortgage rates will not decrease. There’s a steady rise of mortgage rates over the past months as the economy start to recover from the 2021 crisis. According to Freddie Mac in their latest quarterly forecast, an average of 3.4% mortgage rate will be expected by the end of 2021 and 3.8% by the end of 2022.
Slow home price appreciation
According to all industry leaders, home price will continue to appreciate towards the end of 2021.
Senior Markets Economist at J.P. Morgan Joe Seydl said that the projected rise of the home prices should be taken as signal for buyers to grab the opportunity as soon as possible instead of waiting with the expectation that prices will decrease.
Inventory will be a less challenging
The good news is that more inventory is coming in the market, giving more choices for homebuyers and decrease the fast pace.
Here are some statements from experts in the field:
“We have seen more new listings this year compared with 2020 in 11 of the last 13 weeks. The influx of new sellers over the last couple of months has been especially helpful in slowing price gains.” (George Ratiu, Senior Economist at realtor.com)
“As an indicator of the economic impact of housing, there are now 652,000 single-family homes under construction. This is 28% higher than a year ago.” (Robert Dietz, Chief Economist at the National Association of Home Builders)
With the expected rise of mortgage rates, price appreciation and the number of expected inventory in the next half of the year, your chances in the housing market look promising.
The only thing left to do is work with the team that is after your own interests. The Rama Mehra Team is here to make great offers, negotiate for your cause and help you find the best deal for you and your loved ones. Contact us today (925) 415-0835!
Starting this March, we will be releasing our comprehensive market update through our email newsletters. Sign-up here and you’ll get them exclusively and for free! Read on for the summary of the report and get a peak of some of the tables found in our monthly newsletter.
Welcome to our March newsletter. This month, we examine how housing affordability in California may affect future demand by looking at housing affordability in relation to price, interest rates, and per capita income.
COVID-19 cases continue to decrease after peaking in January. The United States is administering nearly two million vaccinations a day, and projects it will be able to vaccinate all U.S. adults by the end of May. While the feeling of hope is palpable, COVID-19 will continue to affect how we live and work for quite some time. We expect demand for housing to remain high for years to come. Even as it becomes safer for people to interact in office settings, we anticipate that working remotely, even if not every day, is here to stay. With less uncertainty around the future, the period of all-time-low mortgage rates is coming to a close, which may boost demand even further over the next several months.
As we navigate an ever-changing economic landscape, we remain committed to providing you with the most up-to-date market information so you feel supported and informed in your buying and selling decisions.
In this month’s newsletter, we cover the following:
- Key Topics and Trends in March: The low supply of housing appears even smaller when considering only 27% of the population can afford to purchase a home. Mortgage rates are likely to remain historically low through 2021 but have begun to rise, which will affect housing affordability.
- March Housing Market Updates: Single-family home and condo prices have shown price stability. As inventory continues to decline, home prices will likely appreciate.
Here are some of the tables that are worth noting:
Housing Affordability Post-Great Recession
Greater Bay Area Median Home Price
Exclusive comprehensive report includes the following:
- connection between housing affordability and housing demand in California
- effects of rising mortgage rates
- comparison of home price in California, the average 30-year mortgage rate in the United States, and per capita income in California—against housing affordability in California
- comparison of North Bay Inventory, East Bay Inventory, Silicon Valley Inventory, and San Francisco Inventory
- and so much more!
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