Here are the updated housing market trends & predictions for 2020 & 2021. As of now, the housing market remains a hot seller's real estate market, with annual price growth reaching record highs and inventory continuing to fall. But Realtor's latest recovery trends point towards more balanced conditions. The demand has softened up as compared to previous weeks and the supply saw the largest improvement since March.
Whether it will cool off with a sharp decrease in the pace of price growth can only be seen in 2021. As of now record-low mortgage rates and shortage of inventory have kept the US housing market strong with respect to buyer demand. Strong housing demand pushed by the pandemic is driving prices insane in 2020. Both prices and sales are surging month-over-month breaking new records.
In the article, you'll find how the US housing market is recovering week after week from the blows of the pandemic. New home sales have also risen during the pandemic and existing home sales are at a 1-year high. The real estate sector has also been highly supportive of the economic recovery of the country so far. As prices keep climbing month-over-month, it just shows the resilience of the US housing market in 2020 in the face of an ongoing economic recession.
Let’s first look at the negative housing forecast for 2021 and its reasoning. The current short-term demand that is reflected in sharply rising prices, can be attributed to the pent-up demand for home purchases from the March-July period when a great part of the country was in total lockdown. The housing sales and prices have stayed strong through the summer months amid increasingly short inventory and high demand.
This strong buyer activity points to a fall & winter housing market that is more active than normal, where buyers may face more competition and may have to act more quickly than usual to snag their dream home. In the winter season, the sales and prices will continue to rise but at a slower pace. The housing demand is still strong but it has shown some early signs of softening up.