Looking back at our 2020, there are three really big things that took place in the real estate market:
1. Homes values shot up by an astounding 11.8%. We were not expecting that, especially in the year of a pandemic.
2. We saw a record number of sales. Though the full numbers haven’t come in quite yet, the information we do have on our market’s performance December 2020 indicate that we’ll easily blow past the previous record.
3. The average days on market dipped down to just 12. Plenty of properties sold on the same day they were listed, while many more only lasted a couple of days on the market before going under contract.
The fact that our market has been so incredibly strong is surely a good thing, but many people are simply confused as to what’s fueling this unexpected, record-breaking market. Can you blame them? The average median sales price along the Wasatch Front has gone up to $425,000—a huge jump from where it was the year prior. Here’s what’s behind all of the craziness:
1. Interest rates hit a historic low. To incentivize consumers in the marketplace, the government kept lowering rates, which in turn boosted homebuyers’ purchasing power despite rising prices. Real estate was able to act as one of the strongest pillars holding up the overall economy in the midst of uncertainty because demand was sky-high.
2. Millions shifted to a work-from-home setup. Many homeowners found themselves shopping for a new property once they realized that “home” now meant “office,” “classroom,” “gym,” and “refuge.” In general, we saw a reversal of the trend toward immersive urban living that had dominated for at least a decade. In the wake of COVID-19 and subsequent lockdowns, homebuyers sought space. Since their jobs were no longer keeping them tethered in one spot, many folks moved out to the suburbs, or even the countryside.
3. Our already low inventory got even lower. Homebuyers in the 2020 market had significantly fewer options to choose from than their 2019 counterparts, and sellers gain even more of an advantage.
So, now that we know how 2020 shaped our real estate market, where do we go from here? What will the year ahead look like? The answer, as most experts agree, is that we’ll be seeing a lot more of the same; perhaps the numbers won’t be quite as dramatic as they were last year, but the general trends will remain.
It’s not likely that 2021 will match 2020’s double-digit appreciation, but even still, we’re primed to see values increase by 6% to 8%—some pretty mind-blowing numbers in their own right. The formula for another strong year is present: interest rates will remain low (in a wider historical context, they’ll be very low), demand will continue to outpace supply, and the resilient Utah job market will begin to blossom with even more opportunity.
Based on those factors, we anticipate that the median sales price in our market will increase in 2021. So what does all this mean for you? Well, if you’ve even so much as toyed around with the thought of selling your home soon, I implore you to take a good, hard look at the market; now may be a golden opportunity to maximize your sale and upgrade your quality of life. We’ve had tons of clients ask us what their homes could fetch on the market, and after we tell them, they’re fired up and ready to pull the trigger.
If you want to know how your home is worth in the 2021 market or simply have any real estate-related questions, please give us a call or send an email. We’re here to help in any way we can, and we’d love to hear from you soon!