2021 Real Estate Market Predictions

Editor’s note: This article was first published in December 2020. It records what industry professionals expected for 2021 at that time.

The year 2020 was full of uncertainty. With the pandemic still under way and shutdowns in effect, nobody knew when ordinary life would resume.

For housing, it was a year of growth and change. People spent far more time at home, and many went looking for properties better suited to remote work, home schooling and social distancing. Here in Connecticut, buyers moved from the nearby city to suburban homes, and sales rose across the market.

As the year ended, industry professionals shared their predictions for 2021. These were the three we heard most.

1. More people would trade city living for the suburbs

Living in the city used to mean being close to work. As more businesses went remote, that advantage faded, and giving up space for a short commute stopped making sense. Buyers who expected to spend more time at home wanted more outdoor space, more privacy and more room indoors.

2. Offers would keep rising

With so many homes selling, fewer were left on the market. Lower supply and steady demand push prices up, particularly in desirable neighborhoods. For sellers, that meant more room for profit. Rising confidence among both buyers and builders was expected to add to the effect.

3. Mortgage rates would stay low

Mortgage rates were at record lows in late 2020. Analysts and investors expected them to stay low into 2021 as the economy began recovering from the effects of COVID-19.