10 housing market records broken in 2021
The word "unprecedented" may have been a bit overused during the months since the pandemic began, but it definitely applies to the housing market across the United States.
A confluence of factors such as low mortgage rates, remote work, shortages of homes and building materials, along with wealth inequality exacerbated by the economic fallout from the pandemic led to a wild housing market in 2021, according to Redfin real estate brokerage's chief economist Daryl Fairweather.
Redfin's real estate analysts reviewed housing statistics for 2021 and found the following 10 records that were broken:
1. Median sales price: The national median sales price reached a record high of nearly $400,000 at $386,000 in June. That median sales price was up 24.4% compared to the previous June.
2. Supply of homes: Also in June, there were only 1.38 million homes for sale, which was a record low and down 23% over June 2020. Low mortgage rates contribute to the shortage of homes because they increase buyer demand and encourage homeowners to refinance and possibly renovate rather than sell. In addition, construction of new homes has lagged behind demand for several years.
3. Speed of home sales: The typical home sold in 15 days in both June and July, the lowest median days on the market in history. In comparison, homes sold in a median of 39 days in June 2020.
4. Most homes sold in two weeks or less: In March, 61.4% of homes that went under contract had an accepted offer within two weeks of being listed for sale.
5. Most homes sold for more than their asking price: In June, 56.5% of homes sold for more than their list price, which was a record high. In addition, the average home sold for 2.6% more than the asking price, another record high. Bidding wars were a big contributor to that record.
6. Mortgage rates hit an all-time low: During the week ending Jan. 7, 2021, the average 30-year fixed-rate was 2.65%, the lowest in history.
7. A record-high share of homes was bought by investors: During the third quarter of 2021, investors bought 18.2% of all the homes that were purchased in that period in the United States. That's up from 11.2% during the third quarter of 2020.
8. Second home demand nearly doubled: Home buyer demand for second homes was up 91% in January 2021 compared to January 2020.
9. More people looked to move to a different metro area: Nearly one-third (31.5%) of Redfin users searched for a home in a different metro area during the first quarter of 2021, up from 26% during the first quarter of 2020.
10. Luxury home prices jumped: The median sales price of luxury homes rose to a median of $1.025 million in the second quarter of 2021, an increase of 25.8% compared to that quarter in 2020.
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