2020 was not the best year for numerous industries. This is applicable for the real estate industry as well. We could see how the real estate industry had to deal with numerous challenges that were created by the COVID-19 pandemic. However, things seem to get better in the year 2021. This is he main reason on why we thought of taking a look at the real estate trends for the year 2021. If you are planning to go ahead with real estate investments, this understanding will be able to deliver numerous benefits to you. On the other hand, you can understand how the market behaves, and you will be able to learn how to get the maximum results that would come on your way.
Why should we be worried about the real estate market?
Real Estate is a decisive factor in the US economy. Some of the parts in the United States are more important for the real estate industry when compared to the others It encompasses about 15 percent of the American gross domestic product. That said, the real industry is growing in many counties such as Somerset, Morris and Union County in New Jersey. The industry is growing with many trends.
For example, Georgia is a state that has got a blooming real estate industry. As a result, a large number of real estate investors have paid their attention towards Georgia. Before you go ahead and invest your money in the properties available in the country, it is extremely important to have a basic understanding about the current trends that exist in the real estate market. Then you will find it as an easy task to make an informed decision without any hassle.
Here are some of the hottest trends that you can see in the American real estate industry market. People who are looking forward to investing on the Commerce Real Estate market can also keep an eye on these trends. Then you can make sure that you get the most out of trends and don’t do any mistakes, which can make you regret in the long run.
- Decline of housing inventory
One of the most prominent real estate trends that we can see after the COVID-19 pandemic is the decline of housing inventory. This is something that all of us should be mindful about as well. That’s because the understanding that we have about the housing inventory will help us to make the right decisions with property investments.
The decline of housing inventory didn’t happen because of COVID-19 pandemic. In fact, we could see how it was taking place before the COVID-19 pandemic hit the world as well. In fact, it went down significantly in the month of July 2019. Since then, we can see how it is going down along with time regularly. By the end of November 2020, it has gone down to 38.5% when compared to what was there in November 2019. This clearly shows the impact that the COVID-19 pandemic could create on the housing market of the United States.
The decline of housing inventory is something that we can clearly see in the metropolitan areas of the United States. This is a clear indication that shows the fact that people are not too much concerned about selling their property. However, we will still be able to see a decent number of bare land available for sale.
The biggest drop of housing inventory can be seen in Riverside, which is equivalent to 54%. Then we will be able to se e drops of 52% and 51% in Providence and Baltimore, respectively. The decline in New York and San Francisco are 6.1% and 4.2% respectively.
- Housing prices go up, while the rent prices are still down
One of the most interesting real estate trends that we can see is how the housing prices are going up, while the rental prices are still low. Both housing prices and the rentals went down because of the COVID-19 pandemic. However, the housing prices are going up along with time. The rentals are not going up in the same rate. We can assume that this happens because of the lack of property that is available for sale in the market. When the supply reduces when compared to the demand, it is completely natural for the prices to go high. We are seeing the same as of now.
The growth of prices that we can see in the metro areas is relatively slow. This is something that all the people who wish to go ahead with real estate investments should be mindful about as well. The market could experience price declines in the month of April and May 2020. However, the prices increased by 3.4% by the month of October. Therefore, we will not be able to see a sharp decline of the prices taking place. The median listing was around $400,000 as well.
In general, a house would spend around 64 days in the market before it is sold. We can see a reduction in the number of days that a house would spend in the market recently. This is one of the most important facts that we should keep in mind about the real estate industry as well. According to the way how the trends are behaving as of now, we can expect that to further decline in the future. Therefore, we will be able to see how people will be provided with numerus amazing opportunities to grab their hands in the future with buying or selling homes. That’s because quick transactions will be enabled.
However, we will have to experience low rental prices for quite some time in the future as well. The rental prices of larger housing units are not gaining any momentum at all. This is mainly because the overall economy went down with the COVID-19 pandemic, and people are not yet ready to go ahead and invest their money on the large rental units. People are still assuming that as a risk that they will have to face. We can expect this trend to continue in the future as well. Hence, things would become even more challenging for the people in the future to increase their property rental.
- Changes to the home purchasing trends by buyers
The number of young people who are investing their money on real estate is increasing along with time. This is another benefit that we can experience with the real estate investments. According to a recent study, it was identified that around 39% of the buyers out there are aged under 39 years.
Along with this trend, we can also see how the buyers are continuing to purchase their homes through agents as well. The same statistical report shows how around 92% of the buyers are going forward with agents to purchase homes that are available for sale in the market. That’s mainly because people in today’s world prefer to get the deal closing done by an agent, which will be able to deliver convenience to them. Since the real estate agents are taking care of everything, people who go ahead with the investments will not have to worry too much about anything.
- Larger number of homes
Thanks to the recent growth, you will be looking at an industry with quite a lot of homes. The recent data, however, proves otherwise as builders have halted the projects by last December. That was a temporary situation as the industry is growing on a regular basis owing to the increasing the demand from buyers.
The United States has got a booming economy. Therefore, Commerce Real Estate provides plenty of options for the real estate investors to consider. No matter what your specific preferences are, you can easily get your hands on the best available deals. This can provide an impressive experience to you in the long run as well. That’s because you are not restricted to make a selection out of a limited number of options. Instead, you are provided with complete freedom to go through all available options in the Commerce Real Estate market and get your hands on the best opportunities out of them.
- Expect upscale prices
Towards the later stages of 2021, the property prices kept on increasing steadily. That phenomenon is expected to prevail, albeit with slow growth of sales. Affordability stands in the way naturally when prices go upstream. However, as the private buyers continue to buy property, the sales will increase but in a slow pace.
Due to the booming economy that can be found in the state, it is possible for you to expect the upscale prices. This is completely a natural phenomenon, which all real estate investors are familiar with. However, you don’t need to think twice before you spend your money on the upscale properties. That’s because it can provide you with amazing returns in the long run. You need to take a look at the long term investment value, which the Commerce Real Estate industry can provide you with. Then you will be provided with the opportunity to go ahead with Commerce Real Estate, while keeping the peace of mind as well.
- New buyers
The new buyers are potentially those who aim at settling down in life following marriage and having children. The majority of this crowd are baby boomers and millennials. According to experts, they will comprise about 33 percent of the 2017 real estate buyers. Although the increased price has affected the industry, the young buyers would not cease to exist.
The rising price does not much good news to many young buyers. Even so, there will be cities such as the Midwest where the young buyers can keep their fingers crossed about reasonably priced property. If the real estate properties in cities like New York and San Francisco are beyond affordability, they can always look towards the Midwest with a glimmer of hope. The Midwest is also flourishing intellectual landmarks such as universities in order to make the environment more conducive for an educated crowd.
- Convenient credit availability, probably in the pipeline
Although it is not confirmed as yet, the current administration has given green light to the banks to be democratic in providing loans. This, however, is not among the priorities of the Trump government. The move will encourage more young buyers to consider buying real estate properties. The decisions of Trump, a real estate Moghul himself, will satisfy the requirements of investors too. This is another excellent news available for the individuals who are looking forward to start investing on the Commerce Real Estate market. You will find it as an easy task to get your hands on the available deals with this kind of initiatives. Therefore, you will not have anything to worry about, at the time of making the investments that you always wanted to go ahead with.
- Encouraged foreign purchasers
When real estate prices increase, it may indirectly attract foreign purchasers as well. The foreign business magnates, who look for somewhere stable to keep portions of their wealth stashed away, will find a trove of gems in the US real estate industry. It will be safer for them to invest in a property with increasing value more than depositing the wealth in bank. It sounds financially wise. This is applicable for the Commerce Real Estate market as well. It can be proven from the past statistics recorded.
As you can see, plenty of reasons are available to showcase how the real estate industry of the United States is growing after the COVID-19 pandemic. You will need to keep this fact in your mind and go ahead with your real estate investments. Then you will be able to get all the benefits that would come on your way along with the investments that you do as well. This can deliver multiple benefits to you and you will be able to get maximum returns that come along with those benefits.