According to the latest CoreLogic Home Price Insights Report, nationwide home values increased by 8.2% over the last twelve months. The dramatic rise was brought about as the inventory of homes for sale reached historic lows at the same time buyer demand was buoyed by record-low mortgage rates. As CoreLogic explained:
“Home price growth remained consistently elevated throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of for-sale homes has dwindled as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market.
While the pandemic left many in positions of financial insecurity, those who maintained employment and income stability are also incentivized to buy given the record-low mortgage rates available; this is increasing buyer demand while for-sale inventory is in short supply.”
Where will home values go in 2021?
Home price appreciation in 2021 will continue to be determined by this imbalance of supply and demand. If supply remains low and demand is high, prices will continue to increase.
According to the National Association of Realtors (NAR), the current number of single-family homes for sale is 1,080,000. At the same time last year, that number stood at 1,450,000. We are entering 2021 with approximately 370,000 fewer homes for sale than there were one year ago.
However, there is some speculation that the inventory crush will ease somewhat as we move through the new year for two reasons:
1. As the health crisis eases, more homeowners will be comfortable putting their houses on the market.
2. Some households impacted financially by the pandemic will be forced to sell.
Low mortgage rates have driven buyer demand over the last twelve months. According to Freddie Mac, rates stood at 3.72% at the beginning of 2020. Today, we’re starting 2021 with rates one full percentage point lower than that. Low rates create a great opportunity for homebuyers, which is one reason why demand is expected to remain high throughout the new year.
Taking into consideration these projections on housing supply and demand, real estate analysts forecast homes will continue to appreciate in 2021, but that appreciation may be at a steadier pace than last year. Here are their forecasts:
This was my second time working with The Mercurio Group and this experience was just as great as the first one. Ron and Garry constantly kept me informed and immediately let me know if there were any issues and what needed to be done to resolve them. They are always friendly and on top of things, making sure everything kept moving forward. The entire transaction was excellent and painless. Working with The Mercurio Group was an absolute pleasure and as always, I am grateful for all they do.
I felt Karissa was there for me throughout the transaction. She helped me find the right house and I loved working with her and the team because they worked hard to get me what I needed. I would highly recommend The Mercurio Group. They are a very good group.
Sherri Mercurio helped me the most by handling a potentially difficult conflict of interest between the seller and potential buyer. She has a quick response and a “no problem” attitude. The whole process was made easy and stress free because it was obvious we were dealing with true professionals. It was also an added bonus when we ended up with multiple offers within a few days.
Sherri is down to earth, fun but very professional as well. She knows the in’s and out’s of this business to a “T”. I contact Sherri pretty much all hours of the day and night and she always responded quickly with answers to my questions or with a friendly shoulder to lean on. Unfortunately there were many problems that arose naturally because of buying and selling occurring at the same time. Sherri worked tirelessly to make sure I was happy and had everything I needed to make sure the deal went through. There is not another Realtor in my eyes!
The Mercurio Group are very good at what they do. They were very quick to respond when I had a question which helped me to find my overall experience as Excellent.
We completed 4 transactions with Ron over the course of 4 years which included renting, then selling our starter homes and pooling our resources into one dream home. It could have been a nightmare to go through all that but Ron made everything go smoothly. We couldn’t be happier with our forever home and recommend The Mercurio Group to everyone we know!
Ron, I feel blessed that our paths crossed and you helped me to start a new chapter in my life that I have wanted for a long time. God bless you. Keep doing your good work!
I want to thank you for doing such a tremendous job in not only helping us find a home in Pawtucket, but all the extra things you did to make the move and transition so smooth. We have not received this level of service from a Realtor before and it’s obvious why our friends recommended you. I will definitely recommend you in the future.
Thank you so much Sherri. You worked very hard to help us find a house. You made our first home buying experience a good one. We enjoyed working with you and will absolutely use you in the future.