Current Market Trends
Given the unprecedented state of the world amidst the COVID-19 pandemic and its side effects, the housing market has become a topic of significant focus in recent months. As the summertime season approaches, it has become increasingly clear that, moving forward in 2020, it’s likely that the cost of homes will decrease through the end of 2020.
Thus far in the year, the average cost of homes has decreased by at least a small percentage, despite the fact that the federal government has taken steps to slash interest rates in a bid to uplift the economy as a whole.
One of the more obvious outcomes of the current housing market has been the increase of houses listed as a result of financial uncertainty. As more homeowners struggle to make their monthly mortgage payments or commit to long term ones, more houses will inevitably make their way onto the market. Job instability (or, in many cases, the loss of a job entirely) has proven to be one of the driving factors behind the downward trend in housing costs thus far in 2020.
As a whole, the market is predicted to make more of a recovery by 2021. This, of course, is dependent upon how the remainder of the year resumes – if job instability remains a pervasive problem, for example, it’s likely that home prices will continue to fall until the situation has been reversed.
On average, mortgage rates have fallen to record lows, largely due to the COVID-19 pandemic. Across the board, interest rates for 30-year fixed-rate mortgages have dropped to around 3.19%, and alongside this, applications to refinance home loans have jumped significantly as homeowners have scrambled to maintain affordable monthly payments and hold onto their housing.
The good news is that, according to many real estate researchers, it’s unlikely that there will be a housing market crash of the same magnitude as the 2008 housing bubble. With that in mind, 2020 will likely shift more into a buyer’s market rather than a seller’s one, which is why it’s important to understand the role that the low interest rates and unemployment rate have played in the market so far.
For more information, please visit our website: www.bryanthafizirealestate.com or give us a call at 661-860-6387.
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