The year 2020 will be one that all of us will never forget. With a global pandemic that took many lives and essentially shut down an entire worldwide economy, this has been a difficult year to say the least. With this said, the U.S. real estate market has proven to be one of the lone bright spots this year. Home sales boomed, mortgage rates repeatedly hit record lows and rising values bolstered homeowners’ equity.
- Booming home values: Home buying activity is at its highest level since 2006. Existing-home sales in October were 27% higher than a year ago, new-home sales were 32% higher, and pending home sales or contract signings in September jumped 20.5% annually.
- Record low mortgage rates: Home buyers are locking in some of the lowest mortgage rates in recorded history. Last week, for the 15th time this year, the 30-year fixed-rate mortgage set a record low, averaging 2.67%, according to Freddie Mac.
- Seller equity: The median existing-home price for all housing types was $313,000 in October – a 16% increase from a year ago. In the third quarter, 16.7 million residential properties in the U.S. – 28.3% overall – were considered “equity rich,” according to a report from ATTOM Data Solutions, a real estate research data firm. A property is considered equity rich when the property owner has at least 50% equity in the home.
Overall, 2020 has been a busy year in real estate. There is no doubt that the work from home environment has forced many more prospective home buyers to enter the market. A common theme in many of these property searches is “more space”. The most common reasons for the need for extra space are:
- the need for a home office
- the need for an extra bedroom for an elderly family member
- the need for a home gym
If there is one final item that 2020 has taught us in real estate, it is the sanctity of home! The safety of our home is certainly something that most Americans will no longer take for granted. With most of us spending significantly more time at home these days, it underscores the importance of finding your dream home!