The rental market has gone through a roller coaster ride and you can notice a large number of people bought their new home, while others shifted with friends or family to reduce expenses.
Even though the pandemic was challenging, the rental market is considered as one of the key drivers which support overall growth in the economy. Here we will discuss the key trends in the rental market which are likely to prevail in 2021.
The predictions of chief economists suggest that Rental apartment prices will remain the same till half of 2021. Which can help many consumers to find their suitable apartment at affordable rates.
As many have lost their jobs and are earning only half of their salary due to government lockdown rules. If we look into the key market of rental businesses including, Denver, Atlanta, Phoenix, and Raleigh-Durham, we can find that rental prices will increase in the second half of this year.
As the interest remains low, consumers will continue to buy new homes. The National Association of Realtors reports that home sales are predicted to rise to 5.5 million in 2021, which is the highest annual mark since 2006.
The Washington, based trade group predicted that home prices will rise by 8% in 2021 and 5.5% in 2022 with thirty-year fixed mortgage rates increasing to 3% in 2021 and 3.25% in 2022.
Even though many countries have received vaccines for coronavirus in the middle of December, still it will take another few months to distribute vaccines for every region. As a result, potential renters face challenges in visiting rental apartments and take advantage of online platforms to look for floor plans.
Virtual events are gaining importance as many financial transactions are taking place online. Since renters have started to renew the lease of the apartment online and adopting this new rental market trend widely.
Most of the job seekers travel across the countries to find their new jobs, which resulted in a high rate of remote workers. This new rental market trend has become a common option for job seekers. The number of workers shifting to remote jobs has increased in the past decade.
Also, companies encourage remote workers and mandate this new trend through the middle of 2021. A case study reveals that Increased workplace flexibility will remain the same for the next few years. Since many companies have shifted their workflow remotely in 2020.
Renters will plan to become homeowners if they find housing prices more affordable. Whereas housing prices are rising in few cities and this trend will continue to grow this year. Mortgage reports that demand for single-family rental homes and apartments will be increasing and home buying options may slowdown in half of 2021.
The second wave of COVID-19 outrages in many sectors and this results in increased pressure among renters struggling with low wages and temporary jobless professionals.
There is an unprecedented demand for construction materials, as the process started to rise in 2020 impacting companies like Weyerhaeuser Co., the largest wood producer in North America. The cost of construction materials is still rising as many of the homeowners spent on renovations, built decks, and underwent other renovations.
The high rate of home prices increased the costs of new single-family homes. Which is sold for an additional cost of $16,148 in August when compared to April.
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Rental market trends will continue to change due to the impacts of coronavirus and the high unemployment rate. However the economy will rebound back in 2021, there may be a slowdown of recovery in the beginning, because of consumer insecurity issues in their jobs and finances. Therefore, consumers will choose rental apartments to overcome this uncertainty in near future.