Record-Low Mortgage Rates Set the 2021 Housing Market up for Success
As we settle into a new calendar year and embrace our resolutions, we can’t help but wonder what 2021 has to bring (especially after a year like 2020!). Whether you’re new to the market or a seasoned investor, paying attention to the trends of years past, as well as considering predictions of what’s to come, is vital. Below, our team of mortgage experts share their two cents on 2021 housing market predictions.
Mortgage Rates will Remain at Historic Lows
2020 brought us some of the best mortgage rates in history, but what will 2021 bring? Some professionals predict new lows, while others predict a steady rise. We fall somewhere in between. We’re anticipating another significant dip at some point in the first half of the year, with a minimal climb during the second half. The good news is that even with the expected rise in rates, the likelihood of them returning to pre-pandemic rates is unlikely. Whether you’re in the market for an FHA loan, VA loan, or conventional loan, rates will remain ideal across the board.
The caveat of this is that combined with high buyer competition and low inventory, these low rates will continue to drive an increase in median home prices.
Which brings us to our next prediction…
Median Home Prices will Continue to Climb
If you’ve had an eye on your local market, you’ve likely noticed a lack of inventory. When something does come to the market, it sells in the blink of an eye, no matter the price range. This is a simple matter of supply and demand, making it a seller’s market through and through.
We don’t expect 2021 to look any different, but don’t let this discourage you if you’re a first-time home buyer. Plenty of current homeowners are growing increasingly aware of their lack of space, or the historically low rates have them finally ready to make a move. You’ll want to go through the process of pre-approval so you can come to the offer table ready to go.
When shopping around for the best mortgage rates in the Midwest, we encourage you to do your research. As a direct mortgage lender, you don’t have to worry about dealing with a middle man when working with a Homestead Financial Mortgage lender. From the moment you submit your online pre-approval form you’re in good hands.
Refinancing Will Remain Popular
Maybe you wish to remove your PMI or lower your monthly mortgage payments. Or perhaps the opportunity to pay off your home or high-interest credit card debts and personal loans faster is of interest to you. These are just a handful of the benefits of refinancing.
As it stands, anyone who is currently a homeowner is likely sitting on more home equity than they may realize. One of the most popular reasons for refinancing in 2020 was actually to take out a cash-out refinance loan (or, alternatively, a home equity loan) and tackle a handful of household projects. For some, it was converting unused space into a home office, for others it offered the financial freedom to create a backyard oasis.
Whatever your needs may be, learn how to refinance your home mortgage with Homestead Financial here.
Low Inventory Drives Single Family Home Construction
With many homeowners choosing to stay put and invest in their current homes with the newfound funding of their cash-out refinance loan, more and more wishful buyers will turn to new home construction in 2021.
For many, the idea of anything other than a turnkey, move-in ready home is simply not an option, but low interest rates sure make for a good incentive. Pair these rates with the freedom of designing a home that meets your desired needs, and the idea of borrowing for construction projects becomes much more appealing. Fortunately for us, technology makes it easier than ever to stay connected and receive updates along the way, easing the minds of those who opt for a new build, even during such uncertain times.
Technology Leads the Way
Even with the hopes of a widely distributed vaccine on the horizon, we don’t anticipate safety measures like virtual, distanced transactions and remote closings to change in 2021.
What were once face-to-face transactions will be no obstacle in our increasingly virtual world. iBuyers are gaining market shares, and real estate focused technology continues to evolve in order to meet consumer needs. The convenience of the changes made in 2020 will have likely changed the way consumers and professionals alike navigate the mortgage and real estate markets forever.
With Homestead Financial Mortgage, you can submit your online pre-approval form and expect one of our friendly, experienced loan officers to reach out within 24 hours to get you started. From there, you can track your loan approval status online – all for absolutely no cost to you! #zerotofindout
Midwest Mortgage Lenders You Can Trust
No matter what 2021 has in store, providing excellent service remains Homestead Financial’s top priority. Allow our financial experts to provide you with clear, simple answers to your questions while helping you achieve your financial and homeownership goals. Feel free to start the conversation online, or call us at any one of our Kansas, Missouri, or Illinois offices.
For Kansas residents
8585 College Blvd #110, Overland Park, KS 66210 | (913) 317-1000
For Missouri residents
14897 Clayton Rd, Chesterfield, MO 63017 | (636) 271-4663
For Illinois residents
4215 IL-159, Glen Carbon, IL 62034 | 618-288-7904
3005 Godfrey Rd Ste A, Godfrey, IL 62035 | (618) 980-3860