Last year, more homes sold in the U.S. than in any year since 2006.
The sales spurt during the year’s second half, was, as we had forecast when the COVID War was launched last year, fueled by record-low interest rates, office workers sent home to work, and families seeking more spacious, less expensive “safer” digs away from urban centers.
In the week ending 21 January, interest on a 30-year, fixed-rate mortgage was 2.77 percent, compared to 3.6 percent a year earlier, Freddie Mac reported.
While low-wage workers have suffered during the shutdown, those able to continue working found themselves with the means and opportunity to make changes.
Sales of existing homes edged up 0.7 percent from November through December and totaled 5.64 million homes last year, a 5.6-percent boost from 2019’s level and the largest number since 2006, the National Association of Realtors (NAR) reported. The number of December sales was 22 percent more than a year earlier, the association noted.
TREND FORECAST: The Trends Journal was the first magazine in the world to forecast the Panic of ‘08. We took out the domain name in 2007. The key element of the crash was the housing bubble. Once it burst, it ignited the Great Recession. The current buying frenzy, however, is less risky. There are fewer homes for sale now, lending requirements are more stringent, and borrowing money is cheap.
There were 1.07 million U.S. homes for sale at the end of last year, 23 percent fewer than the same time the year before. That yielded a 1.9-month inventory of homes on the market, a record low, the NAR noted.
The scarcity has pushed the median price of a single-family home to $340,000 at the end of 2020, another record.
