As we settle into a new year, many are wondering what additional effects the pandemic will have on the housing market. The change from a Trump administration to a Biden one is also likely to affect real estate both in 2021 and in the years ahead.
Here’s a summary of some of the housing news so far this month:
Mortgage forbearance extended
The backer of many of the nation’s mortgages has extended a mortgage forbearance program that was set to expire at the end of the month until Feb. 28.
Those with single-family mortgages backed by Fannie Mae and Freddie Mac will not face foreclosure through the end of February.
“To keep our community safe, and families in their homes during the COVID-19 pandemic, FHFA is extending Fannie Mae and Freddie Mac’s foreclosure and eviction moratorium,” said Federal Housing Finance Agency Director Mark Calabria in a statement.
This is the fifth extension of the program that was put into place because of the pandemic. The agency says it will extend or end its policies based on data and health risk.
Those who are having trouble paying their mortgage should contact their servicer immediately to see if they qualify for additional forbearance or a loan modification. The agency says programs are available to help borrowers with eligible hardships and will remain available even when the COVID-19 forbearance flexibilities end.
Biden’s stimulus program includes real estate provisions
President Joe Biden has been in office for less than a week, but he’s already signaled that he’s looking at several real estate issues — with a particular focus on keeping people in homes.
Several of those issues relate directly to the pandemic. In his $1.9 trillion stimulus plan, Biden is proposing $25 billion in rental assistance for landlords and $5 billion for homelessness protection. This is in addition to the $25 billion approved in December’s housing stimulus bill.
Biden is also looking at extending the national mortgage and eviction moratorium until Sept. 30. In the meantime, as one of his first actions in office, he signed an executive order that would extend the current eviction ban until the end of March.
Housing forecast for Weber and Davis counties
Thanks to the pandemic stimulus and Utah’s strong economy, the Beehive State has seen an exceptional bounce-back after losing 120,000 jobs in one month last spring. The Utah Revenue Assumptions Working Group is forecasting a drop in unemployment to 4% in 2021 and job growth of 3.8%.
Meanwhile, the real estate market has surged. Because of Utah’s strong growth in jobs and population combined with a housing shortage that started after the Great Recession, real estate sales and prices are expected to grow in 2021.
Economist James Wood with the Gardner Policy Institute at the University of Utah is expecting this growth to be particularly strong in Northern Utah. During a recent presentation to the Northern Wasatch Association of Realtors, he said he expects single-family home sales to rise 5% in Davis County and 7% in Weber County.
“All of the elements are there: We’re going to have a good year in job growth; we’re going to have net in-migration and low interest rates,” Wood said during the Jan. 12 presentation. “I just expect there’s going to be continued, really serious upward pressure on Davis and Weber County.”
Wood is also forecasting double-digit price increases. He predicts the median sales price of a single-family home in Davis County will rise 10% to $423,000. For Weber County, he says the median sales price on a single-family home could go up 12% to $347,500.
“Where housing is affordable, that’s where demand is really pushing up prices faster than the overall increase,” Wood said.
He expects the interest rate on a 30-year fixed-rate mortgage will remain around 3%.
To learn more about housing conditions and news about the real estate market, contact a local Realtor. Find one at MyRealtorStory.com.