2020 left an impression on everyone and impacted how we navigate the world. The real estate market is just one of the industries that have experienced trends and changes that were unexpected just one year ago. Take a look back at the 2020 market and the predictions for 2021.
Critical Inventory Levels
Currently, there is less than a month’s worth of housing inventory, and we expect to see these trends continue through 2021. There have been increased home construction levels at the end of 2020, which will help add some new inventory to the market, but it will not cover the increased demand for homes and inventory shortage.
Price Increases
Because of the low inventory and high demand, homes are receiving multiple offers and selling for more than the asking price. Almost every home priced at $400,000 or below in the last month has received multiple offers and sold for way above the original asking price. That trend is even being seen in many new home builds, with builders receiving multiple offers. The stories of homes receiving 25+, 50+, and even 100 offers are true!
According to Fannie Mae’s forecast, the group is predicting a 2.8% rise in total home sales in 2021 after a 7.6% rise in 2020. They expect the median existing-home price to rise 4.1% in 2021, but Austin is already experiencing numbers that surpass the prediction. Austin could be an outlier in Fannie Mae’s predictions and see price increases and home sales that far exceed predictions.
Homes Selling Fast
The average number of days on the market is hovering around a month currently, which is more than 20 days faster than what we’ve seen in previous years. This means that the market is filled with serious buyers that are quick to make an offer and start the buying process. Inspections and appraisals are the only things that are keeping closings from wrapping up sooner. We may see closing processes taking a little longer as we head into the spring selling season as more homes enter the market, limiting the available schedules for inspectors and appraisers.
2020 brought Austin a real estate market that is hot, hot, hot, and it doesn’t look like it will be slowing down in 2021. If you’re curious about what we’re experiencing in the current market, or you’d like more insights into our predictions for the year ahead, contact Prism Realty. Whether you’re hoping to buy or sell your home, we’d be happy to help you navigate the fast-moving market.