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Will the Market Crash or Boom?

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Article by Katie Holmes

Photography by Unsplash photos

Let’s take a look at some of the key housing market data for 2021, including housing market trends and predictions for 2021 & 2022. Over a year ago, the ongoing pandemic put the housing market on hold for several months, but the real estate market bounced back and is unusually strong this year, with increased housing demand in almost every region of the country.

The question on everyone’s mind is how long will this housing boom last or will the market eventually crash? Here we are halfway through 2021 and the housing market continues to be HOT resulting in higher home prices and quick-selling homes. One major concern is that housing supply continues to fall well short of demand with the most recent housing market trends don't suggest that inventory is likely to improve soon. Find out the current value of your home with Robb Realty Group's Instant Home Valuation.

The latest data released by the National Association of Realtors shows existing home sales declined for the third straight month in April, which is the result of low inventory and rising housing prices. The supply of homes for sale at the end of April was down 20.5% from one year ago. There were 1.16 million homes for sale, representing a 2.4-month supply. The market continues to be a seller's market.

The lack of housing supply has been affected by the disruptions in the labor market and expensive home-building materials such as lumber that are driving up the cost of new housing, making it difficult for homebuyers to find homes to purchase. Despite the drop in home sales the housing market remains strong with mortgage rates hovering around 3%. The median existing home price in April was $341,600, a new record high that represents a 19.1% increase from a year before. That is both the highest median price on record and the largest annual increase on record.

Mortgage rates are expected to remain low which will help maintain strong housing demand in 2021. The supply-demand dynamic will continue to push home prices up Even with rising mortgage rates and higher prices, the housing market should remain strong due to very tight inventories and increasing demand as more millennials are projected to buy houses this year. Low mortgage rates are great for buyers to get into the market.

2021 has seen an active housing market that’s been driving up prices by double-digits and causing homes to sell quickly in competitive market conditions. Currently, there is an extremely tight supply of homes on the market, the lowest on record since the turn of the century. Further home price gains are expected until either supply ramps up or demand eases. Contact Robb Realty Group to discuss listing your home or taking advantage of the current low interest rates to purchase a home

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