Move over 2020...It's time for 2021 to shine! Or wait...will it be more of the same?
The decorations are down, the ball has dropped in Times Square, and we are ready to take advantage of the fresh start that a new year brings. Unfortunately, it seems like for the first half of January, we're not making progress. The virus continues to rage, and political unrest rules the headlines.
But we like to look for silver linings, and there IS good news for buyers AND sellers as far as market predictions go for real estate in 2021. Read on below to find out what's in store for you and to learn about the latest trends that will influence how we live in the new year.
The virus continues to change the way we live and influences HOW we will live moving forward.
Record low inventory continues to be the top real estate story across most markets, and Tampa Bay is no exception. Yes, many people have decided they want a new house that fits this new lifestyle, but anxious sellers are choosing to wait, possibly to see what happens with vaccinations.
While agents have stepped up their efforts to utilize online tools to minimize face-to-face interactions and in-person showings, many sellers don't want strangers in their house and feel the world is just too uncertain right now to make a big move, and with inventory so low, where would they go?
Buyers, eager to make a move because mortgage rates are so low, are also hitting the pause button on their home search. Just like sellers, they may be trying to minimize health risks and waiting for more options.
Here are a few predictions:
1. If sellers do choose to wait until vaccinations are more readily available, it won't be until late 2021 and early 2022 that we start to see more homes on the market.
2. More homes on the market will NOT tip the scales to favor buyers. It just means that buyers will have more options because the inventory will be healthier. But all that pent up buyer demand means home prices will stay high.
3. Buyers -- don't expect a wave of foreclosures! Yes, many people have lost their jobs, but many have not. Also, it's been almost a year now that people are actually saving their money by not traveling, commuting, or spending money on entertainment outside of the house. Also, most people who own homes right now have a lot of equity in them. Basically, market conditions will improve for you, but they will not favor you.
Sellers -- If you've ever thought about testing the market, now is the time, but do so with intention and strategy. Because inventory is so low, if your house is sitting on the market because it's overpriced when everything else is under contract in four days or fewer, buyers will wonder if there is something else wrong with your home. Also, don't price your home so high that you have to worry about it appraising.
4. According to a new study by ATTOM Data Solutions, home prices are rising faster than rents, but home ownership is still more affordable than renting in many parts of the country, including Pinellas County, due to low mortgage rates. However, one issue first-time homebuyers are experiencing is that they can afford the monthly payments, but struggle with the initial down payment. This is where having a trusted lender comes in handy. I can't stress this enough: CHOOSE A LOCAL LENDER! Better yet, ask your agent to refer one to you.
What is everyone looking for in their new house?
With many people working from home, people are moving away from the open floorplan and want rooms that serve specific functions. Pictured above is a bedroom with a workspace. That may have been okay when we were occasionally working at home, but a daily commute from the bed to the desk three-feet away is not acceptable anymore. People want space for homeschooling, an office, a gym, cooking and relaxing.
See the open bookshelves in the pic above? Now that we're home more, we don't always want to see our junk; it's stressful and distracting. Furniture that has storage options, like ottomans, benches, and cabinets, are gaining popularity. But people do want to feel cozy, safe, and happy at home, so designers predict more pops of color, a movement away from minimalism, and design trends that show off individual personality and a sense of place. In other words, you won't walk into homes anymore and feel like you've stepped into a Crate and Barrel catalog. Instead, you'll get a sense of I'm in Suzy's house at the beach, and it feels like a beach house in Florida, and I get a sense that Suzy loves dogs, her family, and traveling to Paris.
Finally, outdoor spaces are very important. If you're selling a home that has a deck, pool, outdoor kitchen, fire pit, garden, nice landscaping, outdoor lighting...these are all desired amenities.