What's going on in the real estate market in July 2021? | Blog

What’s going on in the real estate market in July 2021?

What’s going on in the real estate market in July 2021? What Investors Should Know

 

  1. The affordability of housing is decreasing.

 

We’ve all heard that home prices have been skyrocketing in recent months, but until recently, low mortgage rates and high incomes had done a lot to keep any real dips in affordability at bay. 

Unfortunately, those days have passed. Housing affordability is now lower than historical averages in 61 percent of U.S. counties, according to ATTOM Data Solutions. This is an increase from the previous quarter’s 48% and the highest share in two years.

 

  1. Renter and homeowner protections are being expanded.

 

The pandemic has resulted in a slew of renter and property owner safeguards, such as an eviction ban, a foreclosure ban, and widespread mortgage forbearance options. Though many of them were set to expire in June, they were extended once more, giving struggling property owners, tenants, and mortgage borrowers more time to recover.

Landlords, of course, got the short end of the stick, and the extension of the CDC’s eviction ban will continue to put a strain on those with nonpaying tenants. Fortunately, the White House has stated that these extensions were the last of their kind. That means evictions could be reinstated soon, at least in areas where local bans do not exist.

Furthermore, when the foreclosure moratorium expires at the end of the month, it could mean more low-cost properties to invest in, as well as some downward pressure on home prices.

 

  1. Flipping rates – and profits – are declining.

 

New data from June shows a significant drop in both home flipping rates and profits. According to the 2021 U.S. Home Flipping Report, flips accounted for only 2.7 percent of all transactions in the first quarter of the year, the lowest share in more than two decades.

Worst of all, Flipping profits have also declined, according to Millionacres. Last quarter, the average flipper’s gross profit was $63,500, representing a 37.8 percent ROI. This is a decrease from the previous quarter’s ROI of 41.8 percent and represents the lowest ROI since 2011.

“It’s too early to tell if home flippers have entered an extended holding pattern,” said Todd Teta, chief product officer at ATTOM. “However, the first quarter of 2021 marked a significant downturn for the flipping industry, with the large drop in activity suggesting that investors may be concerned that prices have simply gone up too high.”

 

  1. The number of listings is increasing.

 

For some time now, the market has been plagued by a supply shortage. However, there have been some glimmers of hope recently.

According to Realtor.com, total active inventory is still down, but only 39 percent from this time last year, compared to the 42 percent drop seen in June.

 

  1. Foreclosures are resuming.

 

Foreclosures appear to be on the rise, despite the ongoing foreclosure new restrictions. According to ATTOM and RealtyTrac, foreclosure filings are up 23% from the same time last year. The number of actual foreclosure starts has increased by 36%.

Last month, one out of every 12,700 housing units experienced a foreclosure filing. Nevada, Delaware, Illinois, Florida, and New Jersey had the highest rates of foreclosure.

According to Rick Sharga, executive vice president at RealtyTrac, investors should be encouraged by the latest data, but they shouldn’t get too excited just yet.

While the increase in foreclosure activity is significant, as Sharga stated, it is critical to keep these figures in perspective. 

She also stated that because of the implementation of the foreclosure moratorium and the CARES Act mortgage forbearance program last year, the year-over-year numbers appear much more dramatic than they are.

 

In conclusion

 

Real estate trends are constantly changing. Do you want to stay up to date on the latest trends and happenings? Please contact me if you have any additional information.

questions

 

Rana Khanjani, MBA

www.Rana.RealEstate

818 723 9071.

Rana@YourRealtorRana.com

 

I come, I see, I sell

 

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