April is flying by and we will be halfway through 2021 before we know it! As some return to work and school and the glimmer of summer vacations lies hopefully ahead, we wanted to share where the market is at and what industry experts are projecting at this time.
In short, rate movement has created a quick shift towards purchase-heavy mortgage activity this season, as we approach a potential peak in price growth this year that is expected to accelerate more slowly next year. Coupled with steady consumer confidence and a continued desire for homeownership, housing health and personal hopes seem to be shining as bright as those blue skies out there!
PURCHASE ACTIVITY
● New & existing home sales are expected to reach 7.1 million units in 2021; projected to fall to 6.7 million units in 2022; 2020 ended at 5.64 million units sold (a 14-year record on account of pandemic driven demand).
● For the first time since December 2019, purchase loans are making up the majority share of monthly mortgage originations.
● March purchase loans rose 31.9%; cash-out refinances grew by 4.1%; rate-and-term refinances dropped by 26.4% month-over-month.
RATES
● Freddie Mac projects 30-year fixed rates will reach 3.4% by Q4 of 2021 and 3.8% by Q1 of 2022.
PRICE GROWTH
● Home price growth is expected to peak this year at a national average of 6.6% and rise more slowly in 2022 at 4.4% appreciation.
CONSUMER CONFIDENCE
● Housing market confidence has improved to 66% as of February 2021, after fluctuating between 48% and 69% last year.
● The percentage of homeowners looking to sell (18%) and renters looking to buy (34%) has held steady throughout 2021 so far.
● The number of individuals asking for home payment postponement has dropped 6% among homeowners and 7% among renters from December 2020 to February 2021.
Well, that’s a wrap! If you have any questions about how this national data compares to Silicon Valley trends or what it means for your own personal goals, please do not hesitate to reach out.
~ Mark
408-596-5526
