WASHINGTON (December 10, 2020) – According to a survey of more than 20 leading US economists and real estate experts, the post-pandemic economic recovery, improvement in working conditions and stable interest rates are expected to continue into 2021. Lawrence Yun, NAR's Chief Economist and Senior Vice President of Research, unveiled the consensus forecast at NAR's second annual Real Estate Forecast Summit today.
The expert group predicted:
- Gross domestic product growth of 3.5% in 2021 and 3.0% in 2022;
- An annual unemployment rate of 6.2% next year, down to 5.0% in 2022;
- Average annual fixed mortgage rate for 30 years of 3.0% and 3.25% for 2021 and 2022, respectively;
- The annual median of house prices is expected to increase by 8.0% in 2021 and 5.5% in 2022.
- Housing construction will start at 1.50 million next year and 1.59 million in 2022.
- The share of the U.S. workforce working from home is expected to be 18% in 2021 – up from 21% in 2020 – and 12% in 2022; and
- Small decreases in office and hotel vacancy rates in 2021 with a slight increase in retail vacancy rates next year.
When asked if the Federal Open Market Committee will change the federal funds rate in 2021, 90% of the experts surveyed said they don't expect the current rate to change from 0%. For 2022, the experts forecast a rate increase of 0.25%.
"It is an understatement to say that 2020 was full of challenges and surprises," said Yun. "One amazing development, however, was the hot real estate market as consumers looked at record-low mortgage rates and debated what a home should be in a new economy with flexible work-from-home schedules."
In 2020, home sales will hit 5.52 million, the highest annual mark since 2006, with the median home price hitting a record high of $ 293,000, according to NAR.
Top 10 real estate markets during and in a post-COVID-19 environment
NAR identified 10 markets that have shown resilience to this pandemic and are expected to perform well in a post-COVID-19 environment over the next two years. In alphabetical order, the markets are:
- Atlanta-Sandy Springs-Alpharetta, Georgia
- Boise City, Idaho
- Charleston-North Charleston, South Carolina
- Dallas-Fort Worth-Arlington, Texas
- Des Moines-West Des Moines, Iowa
- Indianapolis-Carmel-Anderson, Indiana
- Madison, Wisconsin
- Phoenix-Mesa-Chandler, Arizona
- Provo-Orem, Utah
- Spokane-Spokane Valley, Washington
"Some markets have performed exceptionally well during the pandemic, and they are likely to carry this momentum well into 2021 and beyond as new immigrants have immigrated heavily, the local job market recovers faster and the environment in which to work too Is cheap from home. " other factors, "said Yun.
NAR identified the top 10 metro areas based on a number of indicators it believes will have an impact on a metro area's recovery and growth prospects in a post-pandemic environment over the next two years, including: unemployment rate; Net domestic migration, including moving companies from expensive west coast areas; Share of employees in the retail, leisure and hospitality industries; Mobility to retail and recreational places; and the proportion of the workforce that works from home, among other things.
"As we look to 2021 and beyond, we expect these 10 markets to perform well and potential buyers to find particularly favorable terms to buy a home," said NAR President Charlie Oppler, a Realtor® from Franklin Lakes, NJ. and CEO of Prominent Properties Sotheby & # 39; s International Realty. "Overall, residential real estate will continue to be a major driver of our country's economic recovery and activity in these markets will lead the way."
Low unemployment rates compared to the national average signaled a strong employment environment for residents of these areas. Provo-Orem has the lowest unemployment rate among those listed at 4.2%, followed by Madison at 4.3%, Charleston at 4.7% and Des Moines at 5%.
Areas that are already attractive home purchase targets, especially among moving companies from more expensive West Coast cities, may attract more technicians, many of whom come from organizations with very flexible, and in some cases permanent, work-from-home policies . Overall, the greater Phoenix area attracted the most moving companies from the west coast subway areas, with Dallas ranked second. Atlanta had the highest proportion of workers working from home at 8.8%, compared to the national proportion of 5.6%. Spokane also had a high proportion of its home-based workforce at 7.2%.
At https://www.nar.realtor/reports/top-ten-markets-during-covid you can view NAR's 10 most important markets during and in an environmental report after COVID-19.
The consensus forecasts of the NAR Real Estate Forecast Summit 2020 are compiled as the median of the responses from 23 economic and real estate market experts who attended the 2019 and 2020 summits. The survey was conducted from November 19 to December 4, 2020.
At https://www.nar.realtor/research-and-statistics/research-reports/2020-consensus-forecast you can see the consensus forecast report of the NAR Real Estate Forecast Summit 2020.
The National Association of Realtors® is America's largest trade association and represents more than 1.4 million members who work in all areas of the residential and commercial real estate industries.
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