2020 was a challenging year, no doubt, with many things happening across the country and several affected business areas. Some people wondered how it would impact the real estate market in 2021. Indeed, the pandemic did disrupt property prices around the spring of 2020. However, the real estate market made a remarkable and impressive comeback towards the end of 2020, as reported by real estate experts.
Fortunately, more of these increases in property markets are hoped to be seen in 2021, and for that reason, we look forward to seeing the impact of real estate on the current economic climate. Below are 2021 real estate trends to look out for.
Property prices continue to rise
Surprisingly, the Australian property market has been resilient, even through the 2020 turbulence. In recent months, the market has noticed a steady increase in the prices of property fuelled by the rise in demand and low borrowing costs. Although it is unlikely that any of this will change in 2021, we can only hope for an unexpected surge in the volume of stocks listed for sale.
January median regional property prices:
2.Byron Bay: $1,552,367
4.Suffolk Park: $1,495,220
7.Kangaroo Valley: $1,304,366
Generally, it seems that 2021 is shaping up to be a solid year for the housing market, even though certain areas are expected to fare better than others. While analysts have reported that housing prices would increase by double digits this year, these prices will keep rising by up to 10 per cent or more if there is no regulatory intervention and can very well continue till the end of 2022.
Finally, the future of the rental markets depends on certain factors like the level of immigration, the level of interest rates in the coming years and the persistence of the working-from-home phenomenon.
There will be competition in the buyer’s market
Venturing into the property market as a buyer can be very challenging, especially in 2021. This is mainly because of the increased demand, and house prices are expected to rise continuously after the pandemic of 2020. In all, you should expect a great deal of competition in the market. Your best chance at beating the competition and purchasing a home is by acting fast and smart.
Despite the massive competition in the property market, there are still some advantages to it. For starters, the interest rates could go as low as 2.9 per cent, and there is also the case of homeowners or landlords reducing the price of their rental spaces or even offering incentives and services to draw in tenants. This is an excellent idea if you are looking for temporary space or living around or near the city.
Some rental markets will remain challenging
Certain areas like the inner city unit markets and the renter-centric areas faced challenges during the pandemic period. This is because these areas are reliant on people migrating to the new city. It does not matter if the new city involves people coming in from overseas for work or study or people simply migrating.
Note that inner-city apartments have seen a significant reduction in demand and a subsequent fall in price. With the decrease in demand for inner-city apartments, rentals in outer capital city housing markets have significantly increased. This will also affect the median house prices.
As long as the Australian international borders remain closed, there will be a continued fall in demand for inner-city apartments.
Online real estate services are growing
After the pandemic of 2020, several businesses have taken up online residence. This means that most businesses operate online, and real estate is no exception. With online real estate services, you can browse or search for a list of homes for sale or rent online. To make things easier, online companies can help you sell or buy a house wherever you want.
Although it’s much easier to work with virtual companies, there’s always a chance of receiving partial services similar to working with an agent, but for a fraction of the cost. For example, virtual or online companies buy the house you want to sell from you, pump or invest money into it by handling the processing jobs like inspection and repairs, and then resell them at a much higher price. This way, they still charge you just as much as an agent would for selling costs. In the end, it could mean less profit for you.
There is a lot of uncertainty surrounding our lives, jobs and economy. However, the real estate market forecast has made one thing clear: to expect a hot seller’s market in 2021. This could be a great time to list your home if you are in the suburban area.
If you’re thinking about selling your home, the experienced team of real estate professionals at A.M. Rutty Coastal Estate Agents can help! Get in touch with us today.