Did you see our first and second “Year In Review” posts? In this third and final part of the series, we offer our predictions for the real estate market in 2021. This is just scratching the surface of what we expect to see next year. However, please get in touch for any specific questions about the market over the next 12 months. Let’s start with the thoughts of our founder, Michelle Kim…
“I strongly feel there will be a condo market rebound in the third quarter of 2021. This is specific to San Francisco as FB, Google, and biotech companies are giving their employees a choice to return to their offices starting in July. Where they decide to reside will determine their salary rate. This in turn will have a majority of the employees relocating to the city and hence, will increase the rental market as well. Additionally, the historically low interest rates are projected to remain in 2021 which will drive an increase of buyers to the market.”
“The passage of Proposition 19 will lead to increased inventory levels of single family homes in Q1 and Q2 as sellers take advantage of the tax benefits. Interest rates will continue to remain low throughout the year, resulting in a great situation for buyers!”
“I am optimistic the 2021 housing market in San Francisco will continue to grow. Families will continue to evaluate their living space and what they need in a home going into 2021. As we slowly get out of this pandemic and people are going back to their workspace, we will see an increase in housing needs. With mortgage rates forecasted to remain low, there will be high buyer demand, increasing home prices. Buyers today can purchase a home for 10-15% less than in 2019.”
“The San Francisco real estate market, especially the currently hard-hit downtown condos, will make a slow but steady recovery in 2021 due to continued low interest rates, availability of a safe/effective Covid vaccine, and workers gradually returning to the office. Condo buyers have largely stayed on the sidelines unsure whether pricing has already reached the bottom, so as the positive news continues, buyers (both owner occupiers and investors) will return to purchase at a discount relative to pre-pandemic pricing levels.”
“Home prices continued to rise through the pandemic and should continue to rise through 2021. Why? Mortgage interest rates are at incredible lows and will continue to stay low well into the New Year. Not only does this bring more buyers into the market but allows buyers to afford more.”
“The condo market around the Bay Area will start to heat up again, especially in areas close to transit hubs. As interest rates also begin to rise, those who were sitting on the sideline monitoring the market will finally decide to jump in. We may see another competitive seller’s market.“
“I have a strong feeling that we will continue to see a demand for Single Family Homes throughout the year. The real change will be with condominiums in the mid to late 2021 that will see more of a demand as people have new work schedules that allow them a flex of working from home and the office, they will want to be closer to the office once again. The charm of San Francisco will slowly be coming back and people will want to be around that. I suspect low interest rates will continue to hold through 2021, and maybe even 2022 to help keep the economy stable. Which will in turn get more buyers into the market who have been waiting to have better answers on what the expect their world would be like in the coming future.”
“Our higher inventory this year is unusual and in 2021, we will see the increased demand catching up to the inventory. I believe the condo market will make a comeback as offices will open up along with restaurants and bars. Our City will return to somewhat normal as before with some TBD modifications.”
We hope you and your loved ones have enjoyed a safe and joyous holiday season! And again, if you have any questions, please get in touch: –
