Why do home prices tend to increase so much? The simple answer is that the price of homes fluctuates depending on supply and demand. In 2021, you’ll find that home price appreciation continues to increase because the supply isn’t meeting the demand.

A year since the COVID-induced national closures of 2020, the United States is seeing a strong housing market continuing through mid-2021. The demand for homes combined with a strong labor market and low mortgage rates have seen the prices for homes increase. After falling for ten of the previous 12 months, active listings have seen an increase for the past several months.

Real estate has always been considered a beneficial addition to a portfolio, whether it’s for a short- or long-term commitment, so it’s important to note when prices increase. One of the key factors that play a role in price appreciation involves infrastructure development.

Any additions of transportation, transit, or connectivity will drive growth, since they’re expected to bring in more people and more demand. By timing your purchasing correctly, you can capitalize on your real estate investment.

Home price appreciation will continue to increase as long as the demand for housing stays high while the supply stays at near-historic lows. If you are ready to take the plunge into the real estate market or have more questions about how home price appreciation works, reach out to a real estate professional.

Sources: Housing.com, Keepingcurrentmatters.com, Businesswire.com


We are ready to help you find the best possible mortgage solution for your situation. Contact Sheila Siegel at Synergy Financial Group today.