6 Reported Rental Trends You Might Want to Keep in Mind For 2021
To say that 2020 has been unpredictable would be an understatement. That’s why it might seem somewhat bold to speak about upcoming trends. Still, experts have already started to study current market trends to find out what the next year has in stock for us.
Now, the global economy is still running wild and everywhere. Some industries experience massive losses while others have survived, yet some sectors have actually grown thanks to all the health measures and regulations.
That said, real estate has been, by far, one of the most intriguing industries when measuring the repercussions of the COVID crisis. Some markets have crumbled while others have benefitted from many current trends and strategies.
With that in mind, let’s see what experts have to say about next year.
Some of the Most Intriguing Upcoming Trends
AZ Big Media recently released a list with 6 alluring trends for real estate in 2021. As retail prices fluctuate in every city, people are still moving, and companies are still figuring out what’s better between office work and remote shifts.
Yet, reports have shed a surprisingly positive outlook of how the market is doing. Measures like lowering mortgage rates actually offer opportunities for people looking to buy a house or businesses planning to invest in retail space.
It’s easy to expect the list to be filled with bad news, but that’s actually not true. Some of these possible trends could offer unique investment opportunities.
Flat Rental Prices for 2021’s First Half
Apartment pricing isn’t likely to change in the first half of 2020. Now, that’s great news for people with lower incomes thanks to the pandemic. However, markets like Atlanta and Denver will definitely experience rent price increases for the second half of the year.
Urban areas have experienced significant losses in demand because of remote work. That’s driven prices down significantly, including expensive apartments. As the virus subsides, people might reconsider moving back to the city, thus raising prices, but it’ll likely take a while before that.
Home Purchases Won’t Die Out
Low interest rates are still low, ta reason for the significant home sales. In fact, estimates suggest that there will be over 5.5 million sales in 2021.
However, some experts do estimate price increases for homes, starting with an 8% for 2021 and 5.5% the year after. The same is true for fixed mortgage rates, albeit around the 3% mark.
Virtual Events Will Still be Popular
Despite vaccination starting, recovery will still be slow, at least until we don’t have to worry about the virus. Visiting other people and even attending events personally won’t be attractive to people for a while.
Virtual classes and fitness sessions have always been popular, and that has only grown during the pandemic. However, events like meetings and even family gatherings might still remain popular for next year.
Locations Won’t be a Priority for Job Seekers
One of the main reasons for the population levels in larger cities is job opportunities. Smaller cities and suburbs tend to be less expensive than apartments in the capitals because of this, but COVID has changed that.
Remote work has been vital for many companies looking to keep their operations running. This trend results in people moving from large cities to more affordable locations where they can save money on rent. As this working methodology keeps its popularity, it’ll be easier to find a job without moving to another location.
Affordable Housing Demand Will Keep Growing
Right now, mortgage rates are at an all-time low, driving significant volumes in home sales. Many renters are making the switch toward home ownership, and home prices have risen along with demand. It’s likely for this trend to continue.
The second half of 2021 may see rising mortgage rates. As a result, evictions might become an important problem, in turn driving demand toward affordable housing.
Construction Delays Will be Problematic
This year’s summer saw rising prices for construction materials. Lumber supply chains also experienced heavy repercussions as homeowners took their new free time for renovations. It might not be noticeable now, but upcoming building projects will feel these repercussions.
Additionally, the pandemic also halted current developments, particularly for apartments in larger cities. As demand returns, prices will keep increasing, and this prediction might last until 2022.
What do we Think?
Not all markets within the real estate industry are going through the same situations. As you probably noticed already, some are definitely better off than others. That means that adaptability is vital if you want to make the most out of these trends.
As problematic as things might seem, there’s usually another side that offsets the risk. For instance, online commerce might pose a danger for commercial real estate, but co-working’s popularity can be a great advantage.
The best way to make the most out of these upcoming trends is to subscribe to our newsletter. Information is the best tool, and we offer all the news you need to assess your next move.