The real estate market is on fire.
Sales of previously owned homes in 2020 rose to their highest level in 14 years and prices jumped nearly 13% as supply levels hit a record low.
Ultra-low mortgage rates, combined with need to work remotely during the pandemic, helped fuel the rise in home ownership.
From December through November of 2002, existing home sales rose 0.7% to a seasonally adjusted rate of 6.76 million, according to the National Association of Realtors.
Home Prices Jump 13%
The median existing home sales price was $309, 800–up nearly 13% from $274,500 in December 2019. Prices increase in every region of the country. December’s jump marks the 106 straight month of year-over-year gains in housing prices.
Low Inventory Levels
Total housing investors at the end of December equaled 1.07 million units, that’s down 1.4% from November and down 23% from the previous year. Unsold inventory is at an all-time low of a 1.9 months supply at the current sales pace.
All-in, it was a bullish report on the housing market. Though, regionally there are clearly areas that are fairing better than others.
Bullish Prospects for Real Estate
According to Lawrence Yun, NAR’s chief economist, the momentum will continue. Despite the expected slight rise in mortgage rates, sales, he sales are still expected to increase slightly in part due to the anticipation of a better economic environment. “Expect economic conditions to improve with additional stimulus forthcoming and vaccine distribution already underway.” As such, he says, “more buyers [are] expected to enter the market.”