When looking at the real estate market during the second half of last year, it was nothing compared to 2019! The buyers demand was way up, but there just weren’t enough homes on the market to satisfy all of the buyers.
If there is high demand for anything for sale, the overall price will go up. This is the case for home prices too! Dr. Lynn Fisher, Deputy Director of the Federal Housing Finance Agency (FHFA) Division of Research and Statistics, explains:
“House prices nationwide recorded the largest annual and quarterly increase in the history of the FHFA Home Price Index. Low mortgage rates, pent up demand from homebuyers, and a limited housing supply propelled every region of the country to experience faster growth in 2020 compared to a year ago despite the pandemic.”
Below we have listed the 2020 year-end home price appreciation numbers from FHFA, CoreLogic, and S&P Case-Shiller:
“A typical homeowner in 2020, just by being a homeowner, would have accumulated around $24,000 in housing wealth.”
Experts have predicted that the buyer demand will lessen as mortgage rates go up. Others think that the inventory difficulty will relax as more home listings become available.
Additionally, experts believe we will see a strong appreciation this year; but nothing like last year. Below are seven different projections:
As you can see in the graph above, home price appreciation will be strong this year, but it won’t be as strong as last year when the pandemic took off. Connect with our team today to start your homebuying journey on the right foot! Our team of mortgage experts is standing by to analyze your financial situation and help find the perfect financing for your home.