At the beginning of the year, industry forecasts called for home price appreciation to slow to about half of the
double-digit increase we saw last year. The thinking was that inventory would increase from record-low levels and
put an end to the bidding wars that have driven home prices up over the past twelve months. However, that
increase in inventory has yet to materialize. The National Association of Realtors (NAR) reports that there are
currently 410,000 fewer single-family homes available for sale than there were at this time last year.
This has forced those who made appreciation forecasts this past January to amend those projections.
The Mortgage Bankers Association, Fannie Mae, Freddie Mac, the National Association of Realtors, and
Zelman & Associates have all adjusted their numbers upward after reviewing first quarter housing data.
Here are their original forecasts along with the current forecast projection:
Even with the increases, the updated projections still don't reach the above 10% appreciation levels of 2020.
However, a jump in the average projection from 5.3% to 7.7% after just one quarter is substantial.
Demand will remain strong, so future appreciation will be determined by how quickly listing inventory makes
its way to the market.
Entering 2021, there was some speculation that we might see price appreciation slow dramatically this year.
Today, experts believe that won't be the case. Home values will remain strong throughout the year.
If you have been thinking about selling but not sure what your next step should be, please contact me
today at 847-651-6671 so that we can discuss your specific situation.
Thanks for reading and take care,