Last year taught us many lessons, both good and bad, but one thing that still amazes me is how quickly everything changed when COVID struck. Seemingly overnight, our whole way of life changed.
As I take the reins from 2020 President Brandi Pearl Thompson, I’m thankful for her leadership in an unpredictable and unprecedented year.
Witnessing that sort of change is humbling, especially when trying to project where anything might be in 2021, let alone something as specific as real estate. As Brandi can attest, predictions aren’t always accurate, but some indicators can show us the general direction that markets are trending.
I’m thrilled that local real estate has bounced back so robustly. Real estate was deemed an essential service, and Realtors like me worked to the best of our ability to ensure the safety of our clients and community.
As for real estate trends around the nation, I look at some recent studies from leading housing experts, including Lawrence Yun, chief economist at the National Association of Realtors, who gave his 2021 projections during the NAR Real Estate Forecast Summit in December.
Yun’s findings were agreed upon by all 20 participating economic experts.
Housing prices are expected to climb 8% this year and 5.5% in 2022, with 30-year fixed mortgage rates of 3% and 3.25% for 2021 and 2022, respectively.
On the job front, look for an annual unemployment rate of 6.2% this year with a decline to 5% in 2022.
Some welcomed information for a tight housing inventory is a whopping 1.5 million housing starts this year and 1.59 million in 2022.
One consequence of the pandemic has been an increase in individuals working remotely. The share of the U.S. workforce working from home is estimated to be 18% in 2021 – down from 21% in 2020 – and 12% in 2022.
This trend could lead to small declines in office and hotel vacancy rates in 2021, with a slight increase in retail vacancies next year.
Yun summed up the findings by saying, “One astonishing development from 2020 has been the hot housing market as consumers eyed record-low mortgage rates and reconsidered what a home should be in a new economy with flexible work-from-home schedules.”
After the year-end numbers come in for 2020, we’ll be able to analyze better what we might expect locally for the housing market.
In addition to national efforts, Greater Chattanooga Realtors will continue to work with local decision-makers on issues that impact housing affordability and inventory.
I’m excited and ready to lead the Greater Chattanooga Realtors in 2021, and I’m proud to be part of the ever-evolving role that Realtors play nationally and in our local communities. That’s Who We R.
Greater Chattanooga Realtors is The Voice of Real Estate in Greater Chattanooga. A regional organization with more than 2,400 members, Greater Chattanooga Realtors is one of 300 local boards and associations of Realtors nationwide that comprise the National Association of Realtors. Greater Chattanooga Realtors services Hamilton and Sequatchie counties in southeast Tennessee and Catoosa, Dade and Walker counties in northwest Georgia. Information: www.gcar.net or call 423 698-8001.