Mansion Global has recently reported that annual home sales are expected to rise more than 10%, while historic low rates will hover around 2.7-3%. The result is anticipated to be the strongest year of home sales since 2006. While housing strength has been the highlight of pandemic economic recovery, you may be wondering what it really means for you. Here are 5 questions to consider as we head into 2021; find the complete read ‘2021 Will Likely See the Most Robust Housing Market in 15 Years’ HERE for additional data and considerations.
#1: IS THIS THE YEAR TO SELL MY HOME?
Many potential home sellers have been wondering if they should wait for home values to rise further before they sell, or if they should hold onto significant equity rather than pursuing a larger mortgage. There is no one ‘right’ answer for everyone, but if you are planning to sell and move-up, the ideal time is obviously when rates are low and your return on investment is high. Those are the conditions projected to hold up in 2021, so at least obtaining a home valuation and running a few stay vs. sell scenarios is never a bad move. Homes of Silicon Valley offers complimentary home valuations that are substantially more accurate than typing your address into a real estate search engine. Trust us.
#2: IS THIS THE YEAR TO PURCHASE AN INVESTMENT PROPERTY?
Those lingering low rates have many investment minds making moves. The big question is where to buy. With more people working remotely than likely ever, the migration trends are changing. Home ownership is expected to reach 70% by the end of 2021 (a high not seen since 2005!). You may not wish to purchase in markets with a large number of entry-level buyers (also known as the competition). However, rising home prices and low rates can create a very positive potential return on investment if you buy the right property in the right location at the right price. Our experience with investors means that we can help you find that winning combination.
#3: IS THIS THE YEAR TO ADD AN ADU?
There are many reasons that homeowners add an Accessory Dwelling Unit (ADU) - also known as a granny or in-law unit - to their property. There is the obvious – to house an aging parent or grandparent. However, more and more ADU’s are being added as a source of rental income, or even to improve the property’s value and desirability when it comes time to sell. Given the easing of permit requirements, the addition of pre-approved dwellings to many city regulations and the lack of housing in the Bay Area, it is a viable option to consider. Be sure to follow our blog for ADU updates and also reach out if you’d like to be connected with someone who has completed the ADU construction process.
#4: IS THIS MY CHANCE TO MAKE MY BAY AREA EXIT?
It’s okay: we know that not everyone plans to live in the Bay Area forever. If you are thinking of relocating, it’s worth noting that San Jose is #2 and Sacramento is #1 among '2021’s Top 10 Housing Markets’. Seattle, Boise, Phoenix and Denver are also on the list. But does it make sense to move from one hot market into another? Is this a good time to move within the state or out-of-state? These answers will depend on how long you plan to be in your next home, how long you have owned your current home and what other financial considerations you have (kids going to college, close to retirement, etc.). With a firm pulse on where we do business and where our clients have successfully relocated – we can help you weigh pros and cons and potential outcomes with no obligation.
#5: IS THIS THE YEAR TO CREATE MY DREAM KITCHEN/BATH/BACKYARD ESCAPE?
It’s hard to say no to this one! You might be home more than ever, you might have all the equity you need and the ability to draw on it – but do you have the right professional to make it happen? If you don’t – we do! Please remember that we are not only here to serve as your resource for buying, selling and investing – but all things home! Our client relationships do not end when the transaction closes. New fences, new countertops, new pools… making your house YOUR home is the fun part and we love watching it happen. Always feel free to reach out for trusted referrals in all things home and finance; we only share the names of professionals we would (and often have!) used in our own homes.
Cheers to a new year that is exactly what you want it to be.
Mark