Even though 2020 was a tough year for the world, the housing market was the best it has been in a while. CNN Business reported that existing home sales in 2020 rose to the highest level in 14 years as prices climbed to a record high. Home prices rose 9% from 2019 and the median price of existing homes rose to $295,000. The National Association of Realtors put these numbers out saying it is the highest price on record.
According to Lawrence Yun, NAR’s chief economist the trend will continue into 2021. Home inventory is still low, in fact, 2020 ended with the lowest number of homes ever available.
In December 2020, the National Association of Realtors reported 23% fewer homes sold than in December 2019. The strong existing home sales pace seen in the latter part of the year continued into December with sales of existing homes — which include single-family homes, townhomes, condominiums and co-ops — up 22% from a year before to a seasonally adjusted annual rate of 6.76 million.
Ironically homes on the higher end of the market are selling faster than homes on the lower end. December 2020 sales of homes sold between $750,000 and $1 million were up 76% from this time a year ago. Homes over $1 million and above doubled in the number of sales in one year.
“Although mortgage rates are projected to increase, they will continue to hover near record lows at around 3%,” Yun said. “Expect economic conditions to improve with additional stimulus forthcoming and vaccine distribution already underway.”