Are You Ready for Louisiana’s 2021 Real Estate Market?
Coming out of 2020, there’s been much chaos and confusion surrounding all sectors of our country. In Louisiana specifically, the hospitality and tourism industry was hit especially hard by the pandemic, sending thousands into unemployment and others into work-from-home settings. Yet, at the same time, this pandemic lit a fire under the state’s real estate industry. Louisiana home sales are up 33.8% year-over-year, and the median home sale price has increased by 6.4%.
2021 Louisiana Real Estate Outlook: Hot
Homeowner demand has created a hot market with tough competition; 17.4% of homes sold above listing price and likely received multiple offers. The median listing price in the state is $161,800, which is well below the national average. But the median price per home has seen a steady increase of close to 17.0% over the last five years. Because residents have spent more time in their homes due to lockdowns, the focus on personal space and wanting a higher quality of life will likely continue to drive demand.
Louisiana has the nation’s highest rate of homes with negative equity at 8.9%, yet homeowners throughout the state received an average of $12,000 in equity over the last year. It’s likely that this dramatic increase in negative equity is the result of the pandemic’s halt on both the state and national economy. While 8.9% is higher than the national average, month-over-month it has been dropping, the rate of homes with negative equity was 9.3% in September 2020.
Delinquency rates are the seventh highest in the nation, which sounds alarming, but, given the context of this year, we expect it to be a temporary increase that should decrease over the course of 2021. The state has experienced ups and downs in regards to unemployment, which has made it difficult for residents to pay their mortgages on time while balancing payments for other goods and resources during the pandemic. There is progress, though: Currently, the unemployment rate is 8.3%. In June 2020, the unemployment rate was 9.5%, one of the highest in the nation, so we can see that Louisiana’s economy is healing as we move into the new year.
2020 Louisiana Real Estate Market Data
|Zillow Home Value Index||$177,548|
|1-Year Change on Home Values||+4.4%|
|1-Year Change on Rent Prices||+0.0%|
|Homes With Negative Equity||8.9%|
|Delinquent on Mortgages||1.5%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for Louisiana
The historically low inventory in Louisiana has been a catalyst of the rising home prices throughout the state. Year-over-year the number of newly listed homes increased just 0.3%, suggesting that more homeowners are saving for a down payment and waiting to upgrade on a future home. The recent spike in unemployment will only add to the number of homeowners having to wait and save.
Louisiana has a strong tie to our country's history and has had quite an impact on our country since 1812. Known for its vibrant French roots and jazz music, Louisiana’s unique culture continues to draw thousands to Mardi Gras and various music festivals every year. Residents enjoy a relaxed style of living, thanks in part to the heat and humidity, but also in part to friendly neighbors and plenty of gatherings. So, how does the Bayou State compare to the rest of the nation?
- First in crawfish production
- First in crude oil refineries
- First in alligator population
- Fourth most religious state in the U.S.
While the state doesn’t boast within its power rankings, Louisianans are proud of their state and enjoy life with their own unique twist. There’s more here than meets the eye.
2020 was a year of constant change, and 2021 is likely to be the same. One thing that will also be constant is the activity for homeownership within the state. Real estate agents should be ready for an active spring and summer and be prepared to meet client needs primarily online. Update your website, social media pages, and contact lists to be organized and ready.
Take On 2021 With the Best Louisiana Real Estate Courses From The CE Shop
Enroll in our Pre-Licensing program now to get your career started and begin connecting your fellow residents with the home of their dreams. Or keep going strong with one of our comprehensive, 100% online Continuing Education packages. Want to stay up to date on everything in Louisiana? Join the Southern Real Estate Facebook Group!