The third real estate market prediction for the US in 2021 from Core Logic’s chief economist is that home prices will continue to go up, but not as quickly as what we saw recently.
Hi, I’m Sabrina Shaw with Homes By Sabrina, with RE/Max T-town. Our group has been involved in over hundreds and hundreds of local home and real estate transactions. And I trust Core Logic because they base their predictions on data and analytics, not the news. According to Core Logic, the home price index, home prices went up about 7% in 2020. Their economists predict continued growth and appreciation in the first half, but feel it may slow down just a bit in the second half of this year, averaging around 3.4% cumulative growth in 2021 in our national index. However, in areas or communities where the unemployment rate is higher, he feels there could be less appreciation. Areas where employment factors rely heavily on travel, hospitality, entertainment, and eating out, like Las Vegas or Orlando, those areas have been hit harder. So he feels we might see a bit of decline in those areas. The homes may not appreciate as fast. Now it’s important to understand the CARES Act and forbearance. Mortgage forbearance temporarily pauses mortgage payments to provide relief for individuals struggling financially due to what’s happening globally right now. This is a deferment in payments for up to 12 payments or 360 days. Now there are various ways to pay back those payments and continue to make payments on the home. So hopefully at the end of the term, most individuals income has been restored, and they’re in business as usual. However, there is a possibility of more distressed sales at the end of the term, which brings up the possibility of more foreclosures. Although the experts are predicting it will be nothing like we saw back in 2008, as we are in an entirely different situation.
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