If you’re planning buying or selling a home, here is what Southbury homebuyers and homeowners can expect in 2021. In case you don’t know me, I’m Dan Theleen. I’m a real estate agent here in Southbury, Connecticut, providing residential real estate services here in the area. If you ever have any questions about real estate you can always reach out to me. I will be happy to help you.
Despite the health crisis and the economic upheaval in 2020, the housing market remains surprisingly resilient. The housing market this year has pretty much been a seller’s market, causing home prices to appreciate due to low inventory, which has been causing more bidding wars. If you’ve held off on buying a home or held off on selling your home, you probably want to know what this coming year is going to look like because of everything we’ve been through this past year, so here is what homebuyers and homeowners need to know about the housing market in 2021.
CONTINUING LOW MORTGAGE INTEREST RATES
First, you should be aware that the major market conditions of 2020 are expected to continue into this year. These continuing conditions that Southbury homebuyers and sellers can expect include continuing low mortgage interest rates. In the latest projections from Freddie Mac interest rates for a 30 year fixed rate mortgage are expected to remain at or near 3% during 2021, while Fannie Mae expects an even lower 2.8% interest rate. These low rates will continue to make homes more affordable, driving demand for housing in 2021, especially for first time homebuyers. Lower rates and lower monthly mortgage payments will allow homebuyers to buy more home.
Home Prices Still Rising
The next thing we will see this year while the economy improves and interest rates remain low, homes are also expected to continue appreciating. As buyer demand is still high, the Mortgage Bankers Association projects a 2.4% jump in prices, while Freddie Mac expects an increase of 2.6%. Fortunately, if prices do rise low interest rates will help blunt the impact slightly, though it may mean buying a smaller home or dealing with a slightly higher monthly payment.
Inventory Will Remain Low
What’s causing home prices to rise is due to the low inventory of homes on the market, so in 2021 some industry watchers believe inventory may begin to increase, providing buyers more homes to choose from. This change is expected to be the result of more new home construction and more homeowners coming into the market to sell their home, but at the same time there is no clear evidence to date that the housing inventory shortage will be remedied to match or outpace the demand.
Housing development continues to lag across the nation. The supply of existing and new homes so far remains low for the fourth quarter of 2020. It appears unlikely then that this trend will change in 2021 in Southbury.
Will 2021 Be a Buyer’s or Seller’s Market?
So, the last thing you might want to know if you are planning to buy or sell a home in 2021, if it will be a seller’s market or a buyers’ market.
Since 2020 has been a strong seller’s market, the consensus of the industry experts is that Southbury homebuyers and sellers can expect 2021 to be a seller’s market as well, and for basically the same reasons 2020 was, the same reasons I’ve talked about. So if you are planning on selling your home you will be in the driver’s seat with respect to negotiating prices.
In 2021 all this is good news for homebuyers and sellers. If you are planning on buying a home, remember mortgage interest rates will still be near record lows, and if you are planning on selling a home you can still expect the real estate market to stay in a seller’s market, causing your home to appreciate more and keep you in the driver’s seat.
In addition, market conditions vary from local market to local market, making some areas and neighborhoods better for buyers and sellers as well. If you have thought about buying or selling this year in Southbury but have held off, now may be the time to take advantage of this market.
Let’s talk today to take the first step toward your real estate goals in the Southbury area. I’m committed to the real estate market to make sure you have all the information you need to make your next move. Make sure to check out all the resources I have put together for you on my website, and if you have any real estate questions or even just want to meet up for a quick coffee, reach out to me any time.
I look forward to hearing from you. Have a great day.