2020 was a surprising year for real estate. Despite global economic uncertainty driven by a once-in-a-century pandemic, home prices skyrocketed with median prices hitting all-time highs in Q4. Now, with vaccine rollouts promising a major reduction (if not an end) to the pandemic by the fall, 2021 is shaping up to be a very different year. So what does that mean for the real estate industry? While there is no way to be completely sure, the following housing market predictions represent three very likely outcomes: an acceleration in sprawl as people look for more bang for their buck, an acceleration in competition as inventory continues to shrink, and an acceleration in tech adoption as competition among realtors gets tighter.
Prediction: Remote Work Will Drive Sprawl and the Search for More Space
At the height of the first wave of the COVID-19 pandemic, 51% of workers said they “always” worked from home in response to the pandemic. While that number has fallen off as workers and companies have adapted, the pandemic unquestionably accelerated an already-growing remote work trend that has now seen a 91% increase over the last ten years.
One housing market prediction is that remote work as the “new normal” will mean two things for the market in 2021:
- Employees are no longer tethered to the city: With the prospect of long commutes significantly reduced, employees will be more willing to look to more affordable suburban real estate. That means more sprawl and increasing prices in suburbia with potentially corresponding (albeit modest) drops in expensive urban properties.
- Space is at an even greater premium: The longer a person spends in a small home each day, the smaller it feels. With home now the new office, as well, more and more employees will find themselves feeling a little more claustrophobic than usual. As a result, buyers in 2021 will be looking for additional space to accommodate dedicated home officers, adding at least one additional room to most wish lists and further accelerating the urban exodus.
Prediction: Competition for Homes Will Continue to Increase
On the surface, 2020 might have seemed like a year of the worst possible conditions for real estate with the pandemic-driven recession driving people out of work all over the country and the world. Despite a dip at the beginning of the pandemic, things couldn’t have turned out more differently. With the Fed cutting the banks’ interest rates to near-zero, low borrowing costs on mortgages saw a rush into the market even as the economy was crumbling. That, in turn, saw inventory hit record lows as the year went on.
In 2021, low rates are here to stay at least for the immediate time being and houses continue to sell faster than inventory can be replenished. This year will likely see a continuing upward trend in the level of competition for homes and, in turn, prices. That makes a crash highly unlikely, although inventory could become a major source of stress across the industry.
Prediction: The Adoption of Real Estate Tech Will Accelerate
With historically good borrowing opportunities on the table and dream homes drying up, our housing market prediction is that a surge of new buyers will be looking to enter the market before it is too late. Agents need to be ready to seize on those buyers before their competitors do. This increasingly means adopting real estate tech to boost everything from lead capture and management to showings and scheduling to paperwork, and beyond.
2020 was a breakthrough year for many agents on the tech front, as social distancing and strict regulations saw online showings and teleconferencing replace open houses and in-person meetings. The industry also saw wider adoption of customer resource management software – software likely to be at the center of a 2021 real estate tech boom. Real estate CRM platforms streamline and enhance all areas of client recruiting and sales, and are ideal tools for agents in a market where shrinking inventory means competition between realtors will be just as fierce as competition between buyers.
CRM tools like automatic lead capture and advanced lead management keep the top of the sales funnel full, while communication tools like the built-in power dialer included in CRMDialer make client communications more effective and easier to manage.
Arguably the most powerful tool CRM systems offer to real estate agents in a highly-competitive market is their ability to enable, enhance, and automate long-term relationship building with potential sellers – a key task for agents looking to ensure their name is at the top of mind when a property is ready to hit the market.
Real estate agencies looking to leverage technology in 2021 need to look no further than CRMDialer, the real estate industry’s number-one customer resource management platform. CRMDialer offers all of the advanced lead management, marketing, scheduling, communication, and relationship-building tools agents need to sign more buyers and sellers, close more deals, and ensure growth in a rapidly tightening market.
To find out more about how CRMDialer can change the way your agency operates, get in touch with a member of the CRMDialer team today. Or, better yet, put the software to work right away by starting your 14-day free trial today!