With winter here, many people would have thought the real estate market would slow down, but that is not the case. Inventory continues decreasing across the US while the home prices and the number of buyers continue to increase. It looks this way in Canada, as well.
Since the pandemic started, more people have decided they would like to purchase a home due to being able to work remotely, needing more space to work or school from home, lower tax rates in other states, and for political reasons. According to the National Association of Realtors, 40% of realtors had city clients that sought to purchase a home in a suburban or rural area. Due to the increased amount of buyers and the recent increase in lumber and material prices, home values have significantly increased across the country.
Many predict that this trend will not slow down, at least not in the first half of 2021. The top states people are leaving include: Illinois, New York, California, New Jersey, and Maryland. The top states that people are migrating to: Idaho, Arizona, South Carolina, Tennessee, North Carolina, and Texas. When looking for a home in these areas, along with many more areas not mentioned, expect to go into a bidding war. It’s very competitive out there!
If you are not having luck with finding a home at this time, consider one of these:
- Look into areas that are lower on your “I would move here” list;
- Consider buying run-down houses in not-so-hot areas and updating them; or,
- Continue to save up your funds until you find the right home and place to move to.
Now on the contrary of residential real estate is commercial real estate. This part of the industry has a slight decrease in purchases due to the change in consumer trends. Consumers are more focused on shopping online and staying away from public areas, so overall the retail side has taken a dip. The commercial office side has also taken a dip because more people are working from home which requires less space. This may lead to a permanent work lifestyle change for companies.
However, the manufacturing side seems to have stayed the same because the goods still need to be made. More companies are waiting to see how this year plays out in regards to real estate purchasing decisions.
To sum it all up, real estate opportunities are dwindling. Buyers are needing to reconsider their priorities when it comes to purchasing a home these days. If you are a buyer, it may take a while, but don’t give up. Persistence is key.