Three housing trends fuelled by pandemic

Three housing trends fuelled by pandemic
The Covid-19 pandemic has brought three housing trends in the real estate market; preference for vacation and suburban homes, bidding wars or buyer competition and increase in the number of first time home buyers.

Bidding wars or buyer competition Let's shed light on the first common housing trend fueled by the pandemic. Due to fall in the rates of mortgage rates to record low levels, there is an increase in home buying; since the home inventory is too low to meet the buyer demand, consequentially the buyer competition is too strong leading to bidding wars. As per NAR’s REALTORS® Confidence Index Survey, for each sold property there are four offers on average.

Increase in first time home buyers As we have mentioned earlier that record low rates of mortgage have led to an increase in home buying, it has fueled  the housing trend of the first time home buyers investing in the real estate market. in the year 2020, the share of first time home buyers was found to be 33%, but on the flipside increase in home prices made it difficult to purchase homes. The potential buyers took a backseat due to higher closing costs and down payments caused by lack of supply for lower priced homes in the housing market. Many buyers were ready to stretch their budgets more in spite of the tight supply.

Preference for vacation and suburban homes The increase in work from home has freed the remote workers from work commutes, so they are looking for the alternatives in vacation homes. Comparing the data of 2019 and 2020, the vacation homes' sale has risen by 16.3% which made their share to rise to the figure of 5.5% among the homes sold in 2020.

Many real estate professionals have reported that the clients who live in urban areas are showing inclination towards buying a home in rural or suburban areas.