Real Estate Trends in 2020

Real Estate Trends-What Buyers and Sellers Need to Know About Real Estate in 2020

• Trend #1 – Home Prices Are Still Increasing Slowly.

Okay, let’s take a look into previous months. In April 2020, home prices grew by a teeny-tiny 0.6% compared to last year – down from the nearly 4% growth rate in March! This slower growth trend is likely due to the craziness of the coronavirus and market uncertainty. But within the third week of May, home prices moved their way back up to a 3% growth rate – almost to pre-COVID levels! Yes! So, there’s a chance that home prices might be regaining some momentum.

National Association of Realtors Chief Economist Lawrence Yun believes that home prices will make their way back up to 4% growth overall in 2020. So, you’ll likely see home prices continue to increase, but they probably won’t knock your socks off with rapid growth like we’ve seen in previous years.

• Trend #2 – Mortgage Interest Rates Are Super Low.

Mortgage interest rates have been decreasing, even before the pandemic hit. Back in May, the average interest rate for a conventional 15-year fixed rate mortgage (the cheapest type of mortgage and highly recommended) dropped to 2.69% – the lowest it’s been in over seven years!

Economist experts think interest rates will continue to stay low until the economy is close to normal again. But interest rates probably won’t go so low as to hit rock bottom since lenders still have high demand from current homeowners refinance their mortgage at lower rates.

• Trend #3 – Millennial Home Buyers Are the Majority.

Last year, the national average of home buyers were millennials with a whopping 38%. So, what does this mean for sellers? Here are some tips to appeal to the millennial home buyer:

• Upgrade your online listings. Virtually, all millennials (98%) use the internet for their home search, and 78% of them found their home they purchased on their mobile device last year. So, make sure your online listing is appealing by investing in high quality photos or even a video for a virtual tour of your house.
• Highlight the perks over the size. Yes, square footage does matter, but millennials are more concerned about commuting costs and how close their home is to either their school or work. In fact, most millennial buyers said they were least likely to compromise on school and neighborhood quality when deciding which home to buy. So, highlight the benefits of your home’s fabulous location instead of wasting time trying to sell on its size.
• Know popular features. Here are some of the top home features we found that millennials want: laundry room (86%), patio (81%), garage storage (80%) and a walk-in pantry (79%). If you’re thinking of making some upgrades to your home, choosing one of those might have millennials showering you with offers when you’re ready to sell.

With fluctuating real estate trends and the underlining uncertainties of the pandemic of 2020, one thing we can be sure of is the numbers never lie!