If you’ve been following the housing market at all over the last year and a half or so, you know housing prices have been through the roof, and that there has been an extremely high demand for housing coupled with a relatively low supply.
Experts have speculated this hot housing market has been fueled primarily by the COVID-19 pandemic. With more opportunities for people to work from home, and others taking the time in isolation to reconsider what they want out of a home, there have been more people looking to become homeowners. In addition, many millennials are finally reaching the point where they have shed enough of their crippling student loan debt to finally consider becoming homeowners in their 30s.
While mortgage rates have gone up, they’re still at historic lows, which will still continue to make for an attractive market. But once the pandemic is well and truly behind us, what can we expect the housing market to look like?
Here are some issues to consider.
The future of remote work
At this point, enough people have found success with remote work that it’s likely more people than ever will be able to work from home. Companies will save money by downsizing their in-person activities or removing physical office spaces altogether, and workers will seek out jobs that give them the flexibility to work remotely if they wish to do so.
One survey from Zillow found remote workers were more likely to consider moving because of the pandemic—23 percent of remote working respondents said this versus only 13 percent of workers who always work in person.
What will be interesting to watch is how a return to pre-pandemic norms affects housing location and size preferences. An equal number of experts surveyed by Zillow believed Americans’ preferences for living in the suburbs over urban areas during the pandemic was temporary as said it was permanent (46 percent of respondents for each).
There has not been much change in the size of ideal homes for Americans. On average, Americans want a 2,000 square-foot home with three bedrooms and two bathrooms.
Will location (urban vs. suburban) preferences change once the pandemic is officially behind us? It’s hard to say at this point.
Prices have soared as demand during the pandemic has far outstripped supply. But you can expect home prices to continue growing, at least in the immediate future. Experts expect home prices to grow by 6.2 percent over 2021. So, those high prices you’ve seen? Expect them to at least last into 2022. After that, it’s difficult to predict, given the unique market circumstances that have been at play this last year and a half.
There’s a lot of guesswork that comes with determining what the housing market will look like at any point in the future, but especially when there’s a pandemic in the mix. It’s important to work with a real estate expert you can trust when looking to buy or sell so you can stay on top of market trends.
Contact Carpenter Real Estate for more information about buying and selling property in this hot housing market!