Key Takeaways:
- Near record-low mortgage rates made for a strong housing market in the first half of 2021, but now real estate experts are looking forward to the rest of the year.
- Experts’ forecasts are calling for sunshine in the Triangle, with continually low mortgage rates and more housing inventory.
- No other team of Realtors knows the Triangle market better than we do—contact Linda Craft & Team to make your real estate move today!
Here’s What Is on the Horizon for 2021
As we head into the second half of the year, many homeowners are wondering about what’s to come in the real estate market. Nearly record-breaking low mortgage rates paired with rising home price appreciation made for a vigorous housing market in the first half of 2021. While experts project that mortgage rates will remain low and home price appreciation will continue, they do expect some changes worth getting excited about!
Mortgage rates may rise, but still remain relatively low
Many experts are predicting an incremental growth in interest rates. The most recent Quarterly Forecast from Freddie Mac estimates that the 30-year fixed mortgage rate will average 3.4% in the fourth quarter of 2021, then rise to 3.8% in the fourth quarter of 2022. And while mortgage rates are anticipated to increase, they still remain well below historical averages—which means now is the perfect time for homebuyers to maximize their purchasing power.
On an even more positive note, slightly higher mortgage rates will likely help slow down the momentum of home sales, plus steady the appreciation of home prices. According to the same report from Freddie Mac, total homes sales, the sum of both new and existing home sales, will be at about 7.1 million in 2021.
Home-buying conditions are better now compared to later
As projected by a Senior Markets Economist at J.P. Morgan, home prices are likely to continue rising, which means buyers wanting to purchase a home should do so sooner rather than later. Interest rates are inching up and home prices have surged during the last six-to-nine months—and they aren’t expected to come down any time soon. The above graph features 2021 home price forecasts from a few industry leaders.
Buyers rejoice—we see more housing inventory and new home starts
George Ratiu, Senior Economist at realtor.com, sees signs that may point to more housing inventory, which would moderate home prices and ultimately create more choices for buyers. One of these signs is more sellers coming to market—there have been more new listings this year compared with 2020 in 11 of the last 13 weeks.
An influx of new home starts is also good news for buyers who crave more options. According to the Chief Economist at the National Association of Home Builders (NAHB), 652,000 single-family homes are under construction, which is 28% higher than a year ago.
Let Linda Craft & Team Brighten Up Your Real Estate Forecast
All things considered—home prices, interest rates, inventory levels, and home sales—experts remain optimistic about the real estate market forecast for the second half of 2021. Here at Linda Craft & Team, we would love to work with you in the coming months to accomplish your buying or selling goals. Just give our team a call today, and we can discuss how to navigate the Triangle market moving forward!