Notwithstanding the many challenges the country faced in 2020, the housing market remained one of the economy’s strongest sectors. But now that 2020 has ended, what do the experts predict for the 2021 housing market? Due to the continuing record-low mortgage rates and major shifts in rising markets due to increased levels of remote work, it’s typical for Ramsey County rental property investors to question what kind of housing market they could encounter in the months and years to come. Even though no one knows what’s going to happen for sure, there are several factors that can help us predict what to look forward to from the 2021 housing market.
Rising Home Prices
Most housing industry experts assume that home prices will start to rise through 2021. Strong demand and low inventory levels continue to drive prices up in many markets all over the country, and while some typically strong markets lagged in 2020, experts predict that these markets will rebound in 2021. Notwithstanding, investors may want to be watchful for new emerging markets since people are no longer tethered to a specific location by on-site jobs that are leaving from urban centers.
Builders Struggle to Keep Up
With more buyers than homes for sale, and due in part to pandemic shutdowns in 2020, builders in numerous markets find it difficult to cope with the demand for new homes. A couple of experts expect that trend to continue through 2021, but they are hoping that things will normalize by the end of the year.
High Rate of Relocations
One of the big surprises of 2020 was how remote work prompted so many people to seize the opportunity to buy new homes far from their jobs. Recent home sales have been trending away from cities and toward smaller towns and suburban areas for months, which is likely to continue. Investors may find new opportunities in previously slow or declining markets because of the sudden influx of people looking for more room or wide-open spaces.
A New Generation of Homeowners
Millennials are starting to turn 30 this year, typically the age when homeownership levels begin to increase significantly. This large generation has already contributed to the strong demand for affordable starter homes, further reducing available supply and driving up home prices nationwide. As they are competing for a new home, these would-be buyers will be expected to turn to rent or seek creative solutions to home shortages in their preferred areas. This may help investors find renters for properties at higher rates than ever before.
It’s (Still) a Seller’s Market
As home prices rise and listing lags behind demand, experts predict that 2021 will keep on being very much a seller’s market, at least until the fall. The average time a home spent listed for sale has declined dramatically in most markets, with some areas seeing average listing times of days, not weeks. Though some industry experts say that things will ease slightly after the summer is over, in many instances, buyers looking for bargain properties are likely to have lots of competition all year.
After evaluating the 2021 housing market, are you looking to add new Ramsey County investment properties to your portfolio this year – or perhaps sell some before prices fall? Real Property Management Viking can help! We work with rental property investors in Ramsey County and the surrounding areas to facilitate off-market deals you won’t find anywhere else. Whatever your investing goals are this year, we have the tools and expertise you need to maximize each of your rental homes’ earning potential. Contact us today for more information!
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