There are different views when it comes to housing market predictions. Based on the metrics collected by Realtor in May 2020, economists claim that the market might be in for a rebound with the upcoming summer 2020.
Weiss Analytics released the latest report showing that the lack of the newly formed liquidity that took place in the aftermath of the COVID-19 as well as during the first out of the virus, might force many property owners to list their homes at a discount price.
CoreLogic Home Price Index Report noted an increase of 5.4% in the national home prices in May. In April, the noted increases were set at 3.6% in April 2019. According to CoreLogic, the price increase in the housing market is taking place due to the low inventory in the housing market. Furthermore, the current economic situation and relevant metrics are indicating a potential dip in oppose to the rising prices.
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Recovery at a pace of about 10% each month through 2021
According to CNBC report; Home prices will fall 2-3% this year, according to Zillow. As a comparison, home prices dropped just more than 27% nationally during the Great Recession, from their peak in 2006 to the trough in 2012, according to the S&P Case-Shiller Indices. Zillow predicts a very fast 50-60% decline in home sales, which would bottom by the end of the spring and recover at a pace of about 10% each month through 2021. The real estate listing company notes that it is basing its forecast on proprietary data and a baseline prediction of a 4.9% decrease in U.S. GDP in 2020 and a subsequent 5.7% increase in 2021.
Economists Predict a Favorable Period for the Housing Market in Summer 2020
The pandemic outbreak of COVID-19 has placed the housing market on a halt in the US in the first quarter of 2020, while the drops in sales and listings were also making historical lows in mid-April. With the latest report created by Realtor.com, there are indicators that the market of housing in the US could be heading to recovery at the beginning of summer. Based on the metrics collected by Realtor in May 2020, economists claim that the market might be in for a rebound with the upcoming summer 2020.The Housing Market Might Be Heading for a Rebound in Summer
According to Realtor.com, the housing market is preparing for a shift. During this spring, the housing market has shown declines which surpassed previous lows, resembling the crisis of 2008. According to the Chief economist at Realtor, Danielle Hale, who spoked for Yahoo Finance, there are a lot of technical indicators hinting that sales that should have happened in spring, are likely to take place in summer. That way, the reports for the housing market in terms of sales and the number of listings in the market could significantly improve.Inventory Down by Over 44% with Mid-April
As home sellers are relisting their real estate, the inventory in the housing market dropped by over -44% in April, while the prices for houses increased as a consequence. Listings in May were down by -29% with a drop of -20% in the last week of May 2020. This case indicates that inventory and sales could significantly improve during the summer.Housing Prices on the Rise
Even though home buyers are headed for an increased number of homes in the market with the arrival of summer, buyers will need to prepare more money as the prices are rising. In May 2020, there is a recorded increase of over 3% in comparison to the prices of homes in the same month the last year. Economists expect the prices to rise further during summer.
The Unofficial Crash of the US Housing Market
The lack of the newly formed liquidity that took place in the aftermath of the COVID-19 as well as during the first out of the virus, might force many property owners to list their homes at a discount price. With the current rising prices, homebuyers could be thrilled to see the market value of homes going down, which is likely to happen with COVID-19 wrecking the US economy.Weiss Analytics Reports Potential Decline in Home Prices
Weiss Analytics released the latest report showing that the newly listed homes are trading at lower prices. That case scenario might mean that home sellers might be driven to sell their properties urgently with the COVID-19 effects hitting the economy. Compared to pre-COVID-19 home listings, the newly listed homes in the US are selling at 25% lower prices according to the report. As per historic, lower home prices might mean a crash of the housing market.Houses Between Prices 200,000$ and 600,000$ on Discount
According to Weiss Analytics’ report around 30% of newly listed homes are selling at a discount of 6.3% when compared to prices in February. At the same time, 37% of houses that were prices at 600,000$ in the same month are selling at a discount of 7.7%. Besides, as reported by Redfin, a real estate listing firm, the last month’s home sales have had a radical dip by over 27%. Zillow reports a sharp decline for high-end homes, noting a 47% drop in the last month.April Brought Inventory Shortcomings and Plunging Listings
Redfin also reported declines in housing inventory in April at -21%. At the same time, home listings in April have plunged by 41% on an annual basis. Even though there were setbacks that could indicate that the housing market is crashing, the median sale home price is still in the positive zone with a rise of 5%.
Housing 2020: When to Expect the Recovery of the Housing Market?
CoreLogic Home Price Index Report noted an increase of 5.4% in the national home prices in May. In April, the noted increases were set at 3.6% in April 2019. According to CoreLogic, the price increase in the housing market is taking place due to the low inventory in the housing market. Furthermore, the current economic situation and relevant metrics are indicating a potential dip in oppose to the rising prices. Will the market recover from the Coronavirus effects and will home prices continue to surge?Tight Supply in Housing and the Rising Demand
Frank Nothaft, chief economist at CoreLogic considers that the housing market is likely to bounce back when it comes to purchasing activity and prices of homes in the medium turn. Judging by the rising demand noted among millennials in combination with tight supply in the market injects a dose of positivity in terms of waiting for a bounce-back in the market.Bank of America and CoreLogic Shares Opinion on the Housing Market
Bank of America released a similar report to the one released by CoreLogic. Furthermore, the prediction indicates that the virus-induces economic fallout should bring numerous reversals across different markets. More data shows that the prices are less likely to continue to rise in the long run, while dips are expected with newly listed homes that are trading at lower prices when compared to the pre-COVID-19 listings.The Overall State of the Housing Market in June 2020
To jump in instead of usually the busiest period in the housing market, June appears to be announcing increased purchase activity in the upcoming summer. With new homes being listed in the housing market, the prices are more likely to dip, which should result in increased purchase activity.
Is It a Good Time to Buy a House Now: Coronavirus and 2020 – 2021 Housing Market Predictions
Spring is normally the busiest season for homebuyers and home sellers alike. However, the spring of 2020 has brought an unexpected turn of events with the COVID-19 outbreak paralyzing the market and economic growth. Buyers looking for new homes will have a rough time in 2020 as the housing shortage is touching record lows. At the same time, interest rates are also touching new lows in the spring of 2020 with a growing number of borrowers and mortgage users filing forbearance requests.There is a Large Number of Millennial First-time Buyers
Chief economist and senior Vice president at Haus analytics, Ralph McLaughlin, claims that there is a lot of Millennials looking to purchase homes as first-time buyers. McLaughlin further claims that even though the situation in the housing market is not the brightest by far, it certainly isn’t the worst-case scenario when compared to the Great Recession in 2008. As McLaughlin stated, 2008 was an anomaly that shouldn’t happen again.Housing Predictions: What Will Happen to the Housing Market in 2020?
Haus’ McLaughlin predicts that the housing market should see a slight rise in inventory in the summer of 2020 after steep declines noted in spring. The declines could return in the fall of the same year. The Haus’ Vice president and Chief economist forecasts that the situation will improve and achieve balance and stability in the spring of 2021. The demand for homes should drop in summer with new homes available in the market, which should be followed by another drop in the fall and for most of 2020.What to Consider When Buying a Home in 2020?
Homebuyers looking to purchase in the spring of 2020 will be faced with a true challenge if they are looking to find a dream home. Shortened inventory in the housing market should cut options of variety in real estate. That is why new homebuyers should approach the matter with caution. The best option, if applicable and possible in individual cases, would be to postpone home purchases for spring 2021. Home prices are at record highs, which might be another reason to postpone buying a house.
Prices Would fall 3-4% With No Recovery Until the End of 2021
According to CNBC report; The Zillow forecast includes a more pessimistic scenario in which prices would fall 3-4% with no recovery until the end of 2021. They see a 25% probability of that. Others, however, see the pessimistic scenario as more likely. In late March, economists at Capital Economics predicted home prices would fall 4% peak to trough by early 2021, with values flattening out for the rest of the year. “Our expectation that home sales will bounce back in the second half of the year as the economy begins to improve will also prevent a substantial fall in prices. But it will take time for household incomes and savings to recover,” wrote Matthew Pointon, property economist at Capital Economics. Meanwhile Lawrence Yun, chief economist at the National Association of Realtors, predicted that home values would not fall at all this year, but, “are likely to squeeze out a gain in 2020 to a new record high.”
Housing Market Forecast 2020: What Raltor.com Expects from the Housing Market
In December 2019, Realtor.com released a forecast for 2020, revealing its predictions for the housing market in 2020. As expected by George Raitu, Senior Economist at Realtor.com, the forecast got derailed which became obvious already in the first quarter of 2020. Realtor.com updated the forecast for the housing market in 2020, predicting serious drops in sales as uncertainty makes the main keyword in the housing market predictions after the COViD-19 outbreak left many businesses derailed and on halt. What Realtor.com expects to see in the housing market in 2020 after updating the forecast?Drops in Home Sales an Evident Part of 2020 Housing Market
With uncertainty brought to the global economy with the outbreak of COVID-19, Realtor.com updated the forecast for 2020 in the sector of the housing market. The prediction suggests that home sales should drop by -15% as the home prices are dipping. The original forecast had seen the same sector at a slight drop by -1.8%. Moreover, Realtor.com predicts that single-family housing will also drop, going down by -11%. Previously, Realtor.com expected to see the sector up by 10% in sales for 2020.Realtor Claims 2020 is Marked with Uncertainty
As Raitu claims, 2020 brought many uncertainties, which is why the forecast has been radically changed since December 2019. One of the main factors of the year in the housing market is having millennials wanting to buy affordable homes and baby boomers that are not willing to sell. Upcoming elections also play a major role in determining the fate of the markets.Increase in Sales Not Expected by the End of Q4 2020
Realtor.com economists claim that increases in sales in the sector of housing are less likely to happen anytime in 2020 before the fourth quarter. There should be a short-term bump in sales during summer and ahead of the fall as millennial families are looking to settle in new homes before the start of the new school year.
Housing Sales and New House Listings Drop Amidst the Outbreak
According to the research conducted by Zillow, which showed that the housing sales have dropped dramatically during the period when the virus was at the peak of activity. Moreover, the number of new house listings also dropped alongside the declining web traffic activity to real estate websites. Markets such as New York and California reported drops by -70% in new house listings.The Housing Market Most Vulnerable in Florida
Weekly mortgage rates are also dropping with the declining activity in the real estate and housing market amidst the crisis. In the meantime, ATTOM Data Solutions created a report n the local conditions of the housing market in the US. According to the report, Florida appears to be the most vulnerable area in this sector. New York is following strict declines in the market. However, the housing market remains active in Boston.Preventing the 2008 Scenario in the US Housing Market
The federal government is also taking steps to prevent the scenario from 2008 by implementing a moratorium on foreclosures. The COVID-19 outbreak is pulling down mortgage rates in the US, which is how the housing market may be affected. Mortgage services could also experience the full effect t of the crisis, which is why the federal government t is directing mortgage services reduced payments or forbearance.
