Are you interested in purchasing a home and wondering what the market will look like in 2021? Are you on the fence about selling and wondering if prices will hold, escalate, or perhaps spiral down?
Hawaii Real Estate in 2021
We all want to know what the future of real estate in Hawaii will look like, but frankly, no one really knows for sure. What we do know is this — the housing market has been on fire this year. Record-low mortgage rates, sparse inventory, and strong buyer demand have caused home prices to surge. In Hawaii, a wave of buyers who have discovered the beauty of remote working have also chosen to buy properties across our island chain, adding more fuel to what is an ever-tightening pool of housing.
So, what’s in store for 2021? According to Realtor.com chief economist, Danielle Hale, sales are expected to grow 7 percent nationwide. Prices are also expected to rise in 2021. According to Hale, price increases are expected to land around 5.7%. In large part, the lagging supply of housing, coupled with continued buyer demand, are reasons we will see continued growth in the new year.
Will Interest Rates Rise?
According to the expectations of most economists, mortgage rates will tick up gradually. But, they will remain relatively low, and the market will likely remain seller-friendly. That’s good news if you are thinking of selling. It’s not bad news for buyers either. Rates will still remain relatively low.
If you are a buyer, your prospects will depend a lot on inventory. Nationally, new housing starts are expected to grow another 9 percent in 2021. That’s good news. But in Hawaii, we depend a lot on existing homes entering the market. Ultimately, if you are going to have a better selection of homes to choose from, we will need to see an increase in both the construction of new homes and more existing homes entering the market. With Millennial and Gen-Z buyers on the move, inventory will be even more paramount. Throw in mainland buyers who can now work remotely, and it appears that demand for Hawaii housing will continue to grow! Buyers may have to compromise on location or perhaps even settle for a condo over a single-family home, but if you want to buy, there still will be opportunities to do so.
Each Market is Unique
So, what’s in store? Minus my crystal ball, I’m reluctant to predict. Especially, after a year as unpredictable as this one. What I will do, though, is suggest that you consider calling me or your own real estate professional. Whether you are considering buying or selling, it’s important to gather the facts. Your situation is unique, and each market is unique. Get specifics about your home, your finances, your market. Get professional advice so that you can make the best decision for you. Don’t wait. Take action. Ultimately, you hold the keys for what’s in store for you in 2021.