During the beginning of the year, many anxious homeowners and would-be sellers questioned how the pandemic would impact the market. Experts also weighed in with varying results—some said home values would increase, while others predicted a housing crash akin to what we saw in 2008.
As the year continues to unfold, it’s clear that the housing market has been a source of stability during 2020. Here’s how home values could change over the next 12 months.
Here’s How the Market Could Change Over the Next Year
Back in March, it was impossible to predict how the national housing market would fare during a pandemic and global recession. A model by Zelman & Associates guessed that prices would increase by as much as 3%, while CoreLogic forecasted a grim 6% decrease.
However, the housing market seems to be the only industry that’s immune to recent economic downturns. The latest Federal Housing Finance Agency (FHFA) Home Price Index notes that home prices actually rose 6.5% from the same time last year. Let’s break down what this means for 2021.
What do these increases mean for sellers and homeowners?
Although the market did see a slowdown during spring, we saw a pretty remarkable rebound during the summer and fall months. In fact, home prices increased by over 2% between May and July, which is the largest two-month price increase in recent history.
Many potential sellers believe it’s difficult to get the best possible price during the second half of the year, but that simply isn’t the case. If you’re thinking about selling, now is the time to capitalize on skyrocketing buyer demand and low supply.
Are prices expected to fluctuate?
While it’s impossible to predict exactly how the market will perform, it’s safe to say that home prices will likely increase into 2021 and beyond. This may seem like bad news for buyers, but interest rates are still expected to stay low—and that could help you save thousands over the duration of your loan.
The Federal National Mortgage Association, commonly known as Fannie Mae, anticipates that prices could increase as much as 4.4% year-over-year. So even if you aren’t ready to sell your home right now, you’ll probably be able to cash out on your equity if you wait until 2021.
Bottom Line: The Market Is Expected to Stay Strong Through Next Year
This year was difficult for all of us, but the housing market proved to be a silver lining amidst the chaos. If you’re a buyer, it’s best to make a move right now to capitalize on lower interest rates and home prices. Sellers should also get in touch with an agent to begin planning their sale and checking up on local home values. Even though it’s best to sell while demand is high, prices are still expected to increase throughout 2021.
Navigate Your Real Estate Journey with Linda Craft & Team
Whether you’re buying or selling a home, you can never go wrong by working with a top-rated real estate agent. Linda Craft & Team has what it takes to help you achieve real estate success. Contact us today at 919-235-0007 or check out your home’s value to see where you stand in today’s competitive market!