COVID-19 most certainly had effects on the housing market. Both positive and negative, depending on the area in which you reside. In California, the Bay Area, and Solano County the market remained a Seller's market most of 2020. The questions are, will this continue in 2021 and how will the vaccine impact real estate?
The coronavirus pandemic and the ensuing financial crisis have caused immeasurable hardship and pain across the U.S. Paradoxically enough, the crisis has also served as a turbocharged shot to the housing market. Feverish buyers rushed into the market just as COVID-19-shy sellers pulled their homes off—forcing buyers into bidding wars and pushing prices up to new heights. Recession is damned.
Certainly, the vaccines aren't expected to be the end all be all, especially given the rocky rollout rife with distribution problems, inoculation concerns from the general public, and new strains of the virus circulating. Even when America reaches herd immunity, it's not as if the world—and the housing market—will instantly return to some semblance of pre-pandemic normal. (Clare Trapasso, Realtor.com | Jan 11, 2021).
Spoiler alert: The housing market is expected to remain hot, especially in California, but is likely to calm down a little bit.
“We’re going to settle somewhere in between where we were before COVID and where we were during COVID," says realtor.com®'s chief economist, Danielle Hale.
The good news for buyers is the inventor is expected to go up. Meaning, the competition will decrease and buyers won't need to put in offers and waive contingencies before they've even finished touring the properties. With at said, inventory is not going to go up overnight.
"Some people will feel comfortable listing their home during the first half of 2021," says Ali Wolf, chief economist for Zonda, a real estate consultancy. "Others will want to wait until the vaccines are widely distributed. This suggests more inventory will be for sale in late 2021 and into the spring selling season in 2022."
Some sellers held off on listing their homes in 2020, particularly more vulnerable ones because they didn't want to risk getting sick, however, in our area, many real estate agents and Sellers relied heavily on technology to get the job done. And those who found workaround found they were incredibly successful. Additionally, it should be noted that once more people are vaccinated, they're more likely to go ahead with their moves.
"As the risk of serious illness declines because more people are vaccinated, we expect to see more sellers,” says Hale.
There's also expected to be more new homes going up this year, similar to how builders ramped up construction in 2020 despite the pandemic.
Builders could erect a million single-family homes and townhouses next year, predicts Robert Dietz, chief economist of the National Association of Home Builders. That could help to ease the crunch,
"The growth in single-family homebuilding will continue," Dietz says.