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Due to the coronavirus pandemic, there has been a change in how we live and also where we live, and that has toppled some of the common trends in the local housing market.
Now that people can work from anywhere and can also live anywhere, they are moving to reformed markets for all kinds of reasons, from affordability to climate to comfort etcetera.
These are the hottest market for 2021 according to a new report by Zillow:
- Denver
- Phoenix
- Austin, Texas
- Tampa, Florida
- Nashville, Tennessee
The massive majority, 84%, of economists and real estate experts surveyed by Zillow said they expect home value growth in Austin to outdo the National housing market.
Austin ranked top in hottest last year. The average price of homes sold in Austin in December was nearly close to 24% compared with December 2019.
This has become the largest gain among the 50 largest U.S. Housing markets.
Thomas Brown, a Zillow agent in Austin said in the survey
“I think a lot of people consumed their big portion of their income on rent and mortgage in cities like New York and San Francisco during a pandemic and started working from home and suddenly had many options.”
Phoenix came in second for the hottest housing markets, with 69% of the surveyed saying it will outdo the national average, trailed by Nashville, with 67%, Tampa 60%, and Denver, with 56%.
The Zillow senior economist jeff tucker said “The pandemic has not toppled the housing market so much as enhanced trends we saw coming into 2020.
Record-low mortgage rates and the amplified demand for living space, coupled with a rush of millennials purchasing their first home, will keep the pressure on home prices there for the predictable future.”
While these markets are expected to see the most solid value gains, other former hot spots have dropped far out of favor.
The three markets most likely to underachieve, according to Zillow’s survey, are:
- New York
- San Francisco
- Los Angeles
The panelists who partook in the survey do expect these markets to see some progress given the total housing demand nationwide.
Home price gains nationally have been rushing in the last several months. They are active over 8% in November, according to CoreLogic. That is the wildest pace in more than six years.
Prices are being motivated by high demand and short supply, and, more recently, by an enhanced economic outlook driven by progress on COVID-19 vaccinations.
It is not all smooth sailing, though.
As prices rise, affordability deteriorates, and more and more potential buyers are shelved.
The nation’s homebuilders improved single-family housing starts by 12% month-to-month in December, according to the U.S. Census, but they are still distant behind in keeping up with demand.
They are also hindered by rising costs for land, labor, and materials, which prevent them from putting up more affordable homes.
Reference Source: CNBC
