Are You Ready for Massachusetts’s 2021 Real Estate Market?
After the surreality that was 2020, one would not expect that any of the events from last year would lead to a red hot real estate market. After a brief pause in early spring, the Massachusetts real estate market remained hot throughout much of the year. With the median price of a home rising to 11.3%, the demand for homes in the state will only increase competition and home prices as 2021 unfolds.
2021 Massachusetts Real Estate Outlook: Heating Up
Massachusetts’s housing market has seen great rises in both home sale prices and homes sold in the last quarter of 2020. Year-over-year, the number of homes sold with an average increase of 17.3% from September through December. Home sale prices were also higher, averaging 47.3% increases year-over-year.
While the percentage of homes with negative equity is higher than previous years, it’s moderate and currently in line with the national average. However, homes in Massachusetts have gained $31,000 in equity over the last year, which is well above the national average of $17,000.
Delinquency rates within the state have remained relatively low, thanks in part to financial assistance from the CARES Act and other aid programs. It’s likely that financial aid will be required in 2021, but there is a bright light heading into the new year. Massachusetts had the highest unemployment rate in July at 16.1%, but thankfully this percentage has drastically decreased as the state posted an unemployment rate of 6.1% in November. With a vaccine on the way, a hopeful path out of this pandemic seems to be on the horizon.
2020 Massachusetts Real Estate Market Data
|Zillow Home Value Index||$464,279|
|1-Year Change on Home Values||+8.8%|
|1-Year Change on Rent Prices||+3.2%|
|Homes With Negative Equity||3.1%|
|Delinquent on Mortgages||0.7%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for Massachusetts
Massachusetts’s’ current active home inventory is at an all-time low, posting a 54.0% decrease in homes listed at the end of 2020. This has some experts concerned as demand continues to rise, driving a seller’s market throughout the state. With fierce competition and low numbers of homes to choose from, interested buyers can expect a bidding war.
Massachusetts has experienced a growth of demand and interest globally, drawing in bright minds from around the world to be involved with ground-breaking work. Between its growth and the fact Massachusetts was ranked the best state to raise a family in 2020, the state is appealing to all age groups and stages of life. Outside of the cities like Boston lie lush green trees and rolling hills, ready to be explored by former out-of-staters who are looking to call the Bay State home.
When we look at how Massachusetts ranks among the nation, we understand why people are flocking in:
- First in education
- Second in health care
- Fourth in crime and corrections
- Seventh in economy
It’s no surprise that Massachusetts is an appealing real estate market in which to both live and invest. Like its neighboring states, Massachusetts might be one of the smallest states, but it has a large impact on our nation.
The Massachusetts real estate market is expected to continue to be hot entering 2021, with homeowner activity going through the winter. Real estate seasonal trends are also expected to return in 2021; real estate agents should be prepared for a busy spring and summer months. Increased demand and low inventory will continue to drive competition and higher prices, so be conscious of stretching clients' dollars in this market.
Take On 2021 With the Best Massachusetts 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 Massachusetts? Join the New England Real Estate Facebook Group!