Millions of people consider homeownership as the ultimate dream. It’s a key milestone that heralds you’re an adult. Young Americans have heard horror stories about the 2008 recession and caused three million Americans to foreclose on their homes. Yet millennials still consider owning a home far better than renting. That’s one of the reasons people are buying homes in 2021 even though the pandemic is wreaking havoc.
COVID-19 has pushed the United States into a recession. Other countries are not faring well either. Millions of Americans have lost their jobs and are struggling. But the housing market remained robust. Homeowners made a trillion in extra home equity between September 2019 and 2020. The high demand but low supply of homes have caused home prices to soar. But this hasn’t deterred people from purchasing a property.
It’s quite a phenomenon, and experts are scrambling to explain it. Here are some of the reasons people are buying homes in 2021.
The world stopped due to the seriousness of the coronavirus. People hunkered down in their homes to protect themselves. But a few months later, it became clear that it will take years for everything to return to normal. With that understanding, people began to start making plans again. We know we can’t put our lives on hold forever, but we can use this time to secure our lives. Buying a home seems to be the perfect solution since it’s an investment. Plus, you can have a better place to ride out this crisis.
The current administration is pushing for complete vaccination. President Biden and his team are trying to get the economy back on track. This has made people feel more confident about listing their property. This same positive vibe will also cause more people to invest in real estate. The housing forecast for 2021 says home sales will be seven percent above last year’s levels. This will follow a more conventional seasonal trend. Realtor.com says it will even build momentum throughout spring.
One thing that people consider before buying a house is the interest rate. Interest rates are plummeting and expected to remain low until 2023. Prospective home buyers are striking while the proverbial iron is hot.
Freddie Mac’s projected rates for a fixed-rate mortgage will remain at three percent and will continue until next year. Homes will be more affordable and will remain in great demand this year.
The low mortgage rates and the demand are also causing a sense of urgency among home buyers. After all, no one knows how long these reduced interest rates will last. One economist for Freddie says buyers should act now if they find a house they can afford.
The pandemic revealed several things about working from home. One, businesses can survive such a setup. It will likely be the new norm for many companies. Next, it’s hard to work if you don’t have the proper setup. Many have to share a small space with their spouse and children. They have to work and study in the same room, and this isn’t conducive to success.
The uncertainty about the pandemic means the remote work model will continue. This has negated the reason why many workers move closer to their office. People move to the suburbs because they don’t have to live in the city. Some are even moving farther away from where rent or home prices are more affordable. This also provides them with an opportunity to find a larger house.
Prospective homeowners now include outdoor space in what to look for when buying a house. The months of being stuck at home have made people longing for more space to walk around and do things.
It’s why people are choosing neighborhoods with low populations. You get more space to spread your wings or work on your garden. Homes in the suburb are also bigger. They can get the extra square footage that’s lacking in townhomes and apartments.
One survey shows that half of the respondents spent 27 percent more on outdoor time. They also engaged in more outdoor activities over the previous year. People were willing to spend more money for access to national parks. There’s more interest in waterfront properties. These places are not as crowded but are great recreational spots. The desire to have more time outdoors will continue and grow in the coming years.
The real estate industry was quick to adapt to the pandemic. It found ways to stay safe while ensuring people can still buy homes. Virtual tours were one strategy that proved to be very effective. It helped keep the housing market strong while also protecting clients from COVID-19.
A study showed that 25 percent of potential buyers are fine with doing the whole transaction online. Virtual tours give them the chance to see what every room in the house looks like. They can inspect details and think of what they can do with it. Most realty agencies use live images, so people feel like they are going through the house in person.
Was the article informative? Then you’ll also find this post on the Self-Employed Mortgage Access Act May Make Home Loans Easier for Business Owners enlightening.
When you decide it’s time to get that dream home, Reach Home Loans will be with you to help with your finances. Our experienced team of agents is always on hand to help you meet your goals. It doesn’t matter what types of home loans you’re looking at, we got you covered. You can reach us at 954-703-1465.