What to Expect in the Housing Market After the Pandemic

It's already been nearly two years since the novel coronavirus pandemic altered much of American life. Despite the hope of achieving some pre-pandemic normalcy, things remain unpredictable. With overheated home prices and rising mortgage rates, the outlook for the housing market isn't promising. There appears to be an anemic supply of new listings — not to mention falling consumer confidence. After its strong year in 2020, the world of housing now stands in uncertain straits. 

Strong Demand for Homes

The pandemic has begun to subside, allowing the economy to start recovering. As vaccination becomes more widespread, the inventory of for-sale housing is expected to see a boost. With lowered risks to health and renewed financial confidence among homeowners, more and more sellers will participate in the housing market. 

The pandemic has driven home prices higher. But with this increase in inventory, you shall see how it's moderating homebuyer competition. Nevertheless, you must expect a steady growth of home prices to continue into the near future. As you may know, mortgage rates seem to have risen some home value. However, they're still relatively low based on historical standards. This somehow adds to your purchasing power. Thus, it keeps the competition high-geared. 

The Impact of Remote Work

Did you know that an overwhelming 95 percent of panelists surveyed by Zillow agree that there's a permanent shift in people's preference to work remotely, at least part-time? These panelists included not just real estate experts but economists as well. 

Another survey involved asking remote workers what their ideal living situation is. They found that the participants are more likely to think about moving due to the global health crisis. Additionally, of those employees who do telework at least one day each week, 23 percent responded that they're also likely to consider moving for the same reason. As teleworking is projected to persist even when the pandemic ends, the demand for home buying will remain high. This is due in part to the added flexibility that telework offers. 

Will Inventory See a Boost?

In today's frenzied world of property, you'll see that many homebuyers pluck homes off the market within just a few days after they're listed. This rate at which homes are selling these days is one of the contributing factors to low inventory. During the pandemic, this list seems to have steadily dwindled. Now, it sits about 30 percent lower than in 2020. 

Nevertheless, about 53 percent of the panelists stated that the inventory of for-sale homes would start to go up again this year. They're expecting the boost sometime during the third or fourth quarter of 2021. About 38 percent of the panelists believe that this hike in homes being listed for sale is likely the catalyst for inventory growth. 

It's worth mentioning that a previous study, still conducted by Zillow, supports this view. Because of the pandemic, homeowners (which represent approximately eight million households) claim that there's a higher chance that they'll move and put their homes on sale. 

For more information on what to expect in the housing market, visit Blue Horizon Realty and Lending, INC in Escondido, California. Call our office today at (760) 237-4092 to schedule your consultation.