Here’s a quick market forecast for the rest of 2021.
With all the eviction moratoriums ending this January (Update: This has been extended five more months at least!) and foreclosures dominating the news cycle, a lot of people are wondering if our 2021 real estate market will soon fall apart. I can only speak to what’s happening in Southern California, and in our area, we continue to see a lack of supply and high demand for homes. In fact, with record-low interest rates hovering around 3%, demand is extremely high. On top of that, many apartment and condo residents are looking to move into bigger homes because they want more space.
As we look ahead to the rest of 2021, I predict that we’ll continue to see a strong housing market well into the year. One thing capable of changing that, though, is interest rates, but they’re expected to remain low for the time being, so I don’t see our level of demand changing.
Another factor that can affect our market is supply. Over the past year (and even in previous years), we’ve maintained an inventory supply between two and 2.5 months. Even as the market tightened up once COVID hit, inventory stayed around two months. The really good news is that in December, which is traditionally thought of as a slower month, we still had 900 homes listed in the Long Beach area alone.
“I predict that we’ll continue to see a strong housing market well into the year.”
As you can imagine, many people who are looking for homes are wondering where they’ve all gone. Our average days on the market are just 10 days, which means homes are selling quickly and often with multiple offers. This is reflected in the record-high prices we’re seeing in our area. In fact, the average sale price in Long Beach last December—again, traditionally considered a lower month—was $740,000. The average sale price across the entire Southern California region was $873,000.
Prices have reached an all-time high, and I predict they’ll continue to rise throughout 2021 as long as interest rates stay low. That said, homeowners who are struggling with their mortgage payments can sell and take significant equity with them in the near future.
If you’re considering making a move or have any questions about our Southern California market, don’t hesitate to reach out to me. I’d love to hear from you.