Will Home Prices Keep Rising?

Is it the right time to buy?

Prospective buyers are on the receiving end of mixed messages this year. Interest rates are at record lows, yet housing prices are rising. So is it better to continue renting, or to purchase a home? The answer lies in your needs and your location.

Evaluating your needs.

You may need more space for a home office, a separate fitness room, or want more outdoor space for entertaining (or play).

Employment changes.

As many of us are working from home, we have seen a trend towards buying homes in suburban areas, coastal areas, and small towns. Urban living has become less appealing overall. Lifestyle has become a priority.

Home sales.

According to HomebuyingInstitute.com, home prices will continue to rise through 2021, primarily due to limited supply and strong demand. Interestingly, the pandemic fueled the housing sales market. Realtor.com reported that median home listing prices rose 15.4 percent between January 2020 and January 2021. Further, homes sold 12 days faster in 2021, on average.

Inventory.

Simultaneously, home inventory was 42.6% lower this January than last January. Thus, home supply is far lower than demand.

Interest rates.

Mortgage interest rates hit record lows in January 2021. Thus, buyers who plan to take out a loan would be wise to buy before interest rates rise again.

Conclusion.

Contemplate your needs and priorities. Then, survey the market, and ask your realtor for advice :)