Home prices are rising the fastest we have seen in 15 years. According to Goldman Sachs, US home prices will rise another 7% in 2021. In fact, Goldman upgraded its 2021 house-price appreciation forecast to 6.8% from 4.7% previously.
January 2021 saw the fastest rate since 2006 stemming from the low-interest rates and low inventory. The S&P CoreLogic Case-Shriller house price index increased 11.2% in January 2021 year on year. James Orlando, senior economist at TD Economics gives credit to the pandemic. Since spending more time at home during the pandemic, people want to improve on their living situations. Now more than ever, we are seeing more buyers entering the market.
“Underwhelming supply appears to be the primary driver of continued high levels of house price appreciation,” noted Apurva Gundaria and Marty Young who lead Goldman Sachs.
“In our view, this supply crunch is driving another leg up in home prices,” the analysts said. “Though mortgage rates have backed up in recent weeks, they still remain below their pre-pandemic tights and the backdrop for housing demand remains supportive.”
If you are in the market for a new home, now is the time to take advantage of the low-interest rates. Be sure to purchase through a local sales agent who can help you navigate this aggressive current market.
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