Want to know what home sellers can expect going into 2021? When it comes to the real estate market, 2020 has been a turbulent year filled with a lot of negative emotions, and preparing to put your home on the market may seem unrealistic. To get you prepared for what could be waiting around the corner, let’s cover what Salt Lake home sellers can expect going into 2021:
As we are beginning to see the light at the end of the 2020 tunnel, it would seem this year’s theme was complete uncertainty.
An ongoing, devastating global pandemic has created seemingly impossible odds for anyone looking to sell their home, but the reality is showing to be the exact opposite.
The Federal Reserve has done its part to keep interest rates low, allowing for easier borrowing by those buyers sticking around in a favorable market. Mortgage applications took a downturn in the latter half of 2020, but are expected to rocket back in the second quarter of 2021, with a traditional spring real estate boom.
While it remains to be seen how events transpire, home sellers can expect that an isolating winter is likely to give way to an eager tidal wave of buyers descending on a limited inventory of for-sale properties.
Further Government Intervention
The Coronavirus Aid, Relief, and Economic Security, or CARES Act, went into effect in late March of this year and was the first foray into major federal assistance passed by the federal government.
Within the CARES Act, there are two sections dedicated to a moratorium on foreclosures and evictions for tenants and owners living in homes financed by mortgages backed by the Federal Housing Administration. In July, the Urban Institute estimated that this foreclosure and eviction moratorium would be effective in covering over one-quarter of the rental properties in the entire country. This gave those renters and owners covered by the moratorium a big helping hand in adjusting their finances if their income was adversely affected by the continuing coronavirus pandemic.
The federal foreclosure and eviction moratorium is still set to expire on December 31st, 2020, but there have been ongoing discussions to attempt prolonging the moratorium.
The second portion of possible federal intervention could come in the form of another wave of stimulus checks being issued and temporarily propping up local economies, as well as individual savings. Talks in this avenue have been ongoing for months and show no signs of coming to a conclusion anytime soon.
However, with governmental transition ahead, there is the chance for a shift in thinking and action on the part of our political apparatus, and the stimulus discussion moving forward in early 2021.
Investors Will Move Fast
One trend that we see continuing strong into 2021 is the increased involvement of real estate investors providing financial backing to contractors flipping houses in middle-class towns and neighborhoods.
This has become a very popular tactic to earn trust and backing from investors willing to take in small profits boosted through moving high volume. This strategy may decline a bit as the market returns to normal in spring of 2021, and we have our eyes set on investors being able to then cash in on the property inventory they built up over the winter months.
This could mean that these communities that are being targeted by investors could see median home prices take an increase as they recoup their investments and set their sights on new neighborhoods, meaning home sellers can expect potentially increased interest in their properties for sale.