{"id":1118,"date":"2020-12-04T06:00:48","date_gmt":"2020-12-04T11:00:48","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=1118"},"modified":"2024-04-25T23:20:27","modified_gmt":"2024-04-26T03:20:27","slug":"six-trends-that-will-define-real-estate-in-2021","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/six-trends-that-will-define-real-estate-in-2021\/","title":{"rendered":"Six Trends That Will Define Real Estate in 2021"},"content":{"rendered":"\n
\"Image<\/figure>\n\n\n\n

What does the future hold in store for real estate? After an\nunimaginable 2020, dare we guess? <\/p>\n\n\n\n

There\u2019s one thing we can<\/em> say. People want to sell and\nbuy houses. A few key facts and trends can give us some idea of what they might\nencounter in the coming year. <\/p>\n\n\n\n\n\n\n\n

1. Homeowner Equity Should Continue to Rise.<\/h2>\n\n\n\n

If you think of homeownership\nas an equity building strategy<\/a>, property valuations in 2021 will\nreinforce your perspective. Analysts believe U.S. real estate values will climb\nthroughout 2021 and 2022. <\/p>\n\n\n\n

The rise in home prices in 2021<\/a> should be about 3%, according to Lawrence Yun, Senior VP of Research at the National Association of REALTORS\u00ae. Heading into the new year, the median price tag on a U.S. home is just over $316,000.<\/p>\n\n\n\n

If you\u2019re an owner, or you\u2019re thinking of selling, that\u2019s great news. But if you\u2019re thinking of buying, the bar is high. So high that people earning a $72,900 salary could afford only 58% of the houses for sale in late 2020, according to the National Association of Homebuilders<\/a>.<\/p>\n\n\n\n

Not surprisingly, researchers at the Urban Land Institute<\/a> and other real estate think tanks say the home property market will outperform commercial real estate. And while consumer confidence<\/a> might have fallen short of analysts\u2019 predictions, the situation for the average U.S. worker will likely improve as the government issues new stimulus funding in the first half of 2021. <\/p>\n\n\n\n

2. Interest Rates Should Remain Low. <\/h2>\n\n\n\n

\u201cWe forecast mortgage rates to remain unchanged at 3%,\u201d says\nFreddie Mac<\/a>, describing its outlook for the U.S.\nreal estate market through late 2021. As expected, low interest rates have prompted\na flurry of buying and refinancing activity, and this is set to continue. <\/p>\n\n\n\n

All the more so as millennial\nhome buyers<\/a>, who make up a hefty portion of first-home shoppers, grow\nolder and decide to make moves from apartments to houses. As the societal shift\nto remote working continues, many people are considering moves from cities,\nwhere homes are pricey, to areas where homeownership is an attainable goal.<\/p>\n\n\n\n

But wealthy buyers are much better prepared to take\nadvantage of these enticing rates. The importance of an expected 2021 stimulus package\ncannot be overstated, with a major segment of the population facing  career\ndisplacement and job insecurity<\/a>. It\u2019s much harder for independent\ncontractors and people with job instability to get home loans, because mortgage\nlenders have applied heightened scrutiny to applications since the pandemic\ntook hold.  <\/p>\n\n\n\n

3. The Struggle Will Be Real for Urban Sellers \u2014 But It Won\u2019t Last Forever.<\/h2>\n\n\n\n

The global pandemic put a damper on the wave of popularity\nenjoyed by urban real estate. After decades of growing interest in walkable\ncities with access to transportation, shows, bars and restaurants, many big\ncities have seen their tourism industries and their commercial successes slow\ndown considerably.<\/p>\n\n\n\n

On the other side of the coin, country homes, vacation homes, and suburban condos are very much in demand. The suburban home buying trend<\/a> is expected to keep on going through 2021, as people in city-based careers keep working from home<\/a> \u2014 which can be anywhere. Many remote workers have decided to keep their work-from-home lifestyles for the long term. To them, a house is a place to unwind after a hard day\u2019s work\u2026in the home office. <\/p>\n\n\n\n

But while large cities will need a few years to regain their\nformer verve, the Urban Land Institute insists that their current, COVID-related\nlull is certainly not forever. Major cities have the infrastructure to offer a\nhost of cultural events, and will continue to shine as hubs of commerce,\nresearch and education. <\/p>\n\n\n\n

Granted, city life will continue adopting social distancing\nnorms and best public health practices. Yet that will only enhance their appeal\nto people who thrive in the bustling vibe of city life \u2014 no matter where they\nwork.<\/p>\n\n\n\n

4. Real Estate Transactions Will Continue to Happen Digitally. <\/h2>\n\n\n\n

The real estate market met a tremendous challenge in early\n2020, when stay-at-home guidance went into effect to promote public health and\nsafety. But the market rebounded. Mortgage and real estate companies created\nworkarounds for their customers, offering digital tools to carry out\ntransactions with minimal in-person presence. <\/p>\n\n\n\n

Signing and notarization could already be done digitally; but\nnow, many notaries have the tools to do their work without physically meeting\nthe signers. The important debate over remote\nonline notarization<\/a> seems to be over, won by its early adopters.<\/p>\n\n\n\n

Preserving the integrity of legal real estate instruments\nwill be the big issue, to overcome hackers and cybercriminals, and keep titles\nfraud-free. But these days, practically all of the paperwork associated with buying\nreal estate and getting a mortgage loan can be handled electronically. Indeed,\nwith the rise of virtual\nshowings, iBuying, and drone videography<\/a>, the complete home hunting\nexperience can now happen remotely, too.<\/p>\n\n\n\n

5. Traditional, Sleek, Smart: Interior Styles Will Run the Gamut. <\/h2>\n\n\n\n

The year to come is sure to offer something for all tastes: <\/p>\n\n\n\n