John Burns Real Estate Consulting (JBREC) predicts a fresh wave of rental demand on the horizon as inventory remains low and buyer demand remains high. Both the rental and for-sale markets have held up strong during the pandemic due to Americans reevaluating their living situations. Despite many Americans desiring homeownership, now is a good time to rent, says JBREC. Inventory of existing homes dipped 27% year over year in the first quarter of 2021, with regional markets offering just two months of supply. The more popular Southeast and Southwest regions offer less than one month of supply.
2. Housing is expensive and about to get worse.
Home prices rose 13% year over year and our forecast calls for another 15% price appreciation in 2021. The escalation of home prices is a combination of demand outstripping supply and construction cost increases. We also expect mortgage rates to rise, which will contribute to increasing monthly payments. Mortgage payments for existing homes are likely to rise nearly 43% through 2024 due to price appreciation and rising rates. To date, builders have had little pushback on price increases, although we expect that day will come.
Advertisement
Related Stories
Market Data + Trends
Vacation and Investment Home Market Insights
A recent report finds beach homes to be the most sought-after vacation-home type and that the investment potential of a second home is an important factor in the purchasing decision
Affordability
How Much Income Do First-Time Buyers Need to Afford the Average Home?
The median-priced home is unaffordable in 44 of the 50 largest U.S. metro areas
Affordability
What Is the Relationship Between Urban vs. Suburban Development and Affordability?
A new paper from Harvard's Joint Center looks at whether expanding the supply of suburban housing could, in turn, help make dense urban areas more affordable
