With the incoming summer heat comes the possibility for a hot U.S housing market, according to the Home Buying Institute (HBI). After a year of uncertainty and downward trends, 2021 is not only bringing a return to normal life, but also the opportunity for sellers to cash in on the upward trends.
From attractive mortgage rates to an improving economy, there are number of reasons why the housing market will see profit this summer.
Mortgage Rates at a Historic Low
The current mortgage rates present an enticing reason for potential home-buyers to make a purchase this summer. Currently, rates sit at an attractive 3.05%, which is only a small increase from the all-time low rates the market saw in the first week of January. These rates are predicted to increase only slightly towards the end of 2021.
More Demand Than Supply
Currently, there is an inventory shortage on available houses for sale. This dearth of homes for sale gives opportunity for an upward pressure on the price of homes and can give sellers an upper hand during negotiations. “When demand greatly exceeds the available supply, we tend to see things like multiple offers, bidding wars, and offers above the list price,” said Brandon Cornett in an article published by the HBI.
Increased Vaccines, Decreased Restrictions
With the national distribution of vaccines increasing comes lower positivity rates, which means eased restrictions on businesses and fewer closures. This can lead to increased job rates and puts potential buyers in a better financial place.
Increasing Levels of Employment
In February 2021, there were 380,000 jobs added to the national market, especially in the hospitality and service industries. These were industries that struggled greatly during the pandemic. In addition, the unemployment rate went down from 14.8% (in April 2020) to 6.2% (in Feb. 2021).
Consumers Are Gaining Confidence
February experienced a three-month high in consumer confidence as news of vaccine distribution and an economy on an upward trend make consumers more confident in their personal financial state.