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After a rocky road to housing recovery in 2021, who came out on top?
We’ve got the who, what, where—and wow!—of residential real estate
We’ve got the who, what, where—and wow!—of residential real estate
If 2020 toppled the U.S. real estate market, then 2021 scrambled it.
The past twelve months sent people into a tizzy as they sought to buy and sell amidst widespread panic and unpredictability. Sellers commanded top dollar for their listed homes, while families looking to buy had to fight for a mere chance at a walkthrough.
Now that the dust is settling on 2021, experts are weighing in on the tumultuous past year.
“The demand for housing in 2021 shot up while the inventory of homes for sale shrank,” says Elena Cox of Realtor.com. “The number of home listings is down 41% so far this year compared with the same time a year ago, while listing prices rose 11% nationwide. Those extremes resulted in the perfect storm that left our heads spinning.”
The struggle is real
Recent market data reveals a number of success stories among people transacting in 2021—but not everyone, and certainly not everywhere. While specific locales saw record-smashing stats, others saw extreme economic downturn. Great disparity also exists between certain age groups and their diverse demographics.
So, who came out on top?
From East Coast to West Coast, Wall Street to main street, first-time homebuyers to hopeful retirees, Everest has the full scoop:
Biggest Real Estate Winners and Losers, 2021
THE WINNERS
Florida
No surprise here.
The Sunshine State made headlines throughout the pandemic for a variety of reasons. One very compelling fact is that more than a quarter of a million people moved there in 2021, resulting in a 19% increase in median list prices in November.
According to Cox, “They were mostly lured by warm weather, gorgeous beaches, no income tax—and comparatively attractive home prices.”
Fast fact: Over 300,000 people moved to Florida between April 2020-April 2021
Suburbia
The mass exodus continues!
In 2021, suburbs saw an influx of new families looking to escape the exorbitant rents and strict lockdowns of America’s major cities. Not to mention, Covid concerns had people reevaluating their desires: big backyards, home offices, room to exercise, and the like.
“As a concept, suburban living tends to go in and out of fashion with younger homebuyers,” adds Cox. “Let’s just safely say it’s currently in.”
Fast fact: In 2021, the number of suburban homebuyers rose 42% from pre-pandemic
Downsizers
Yep, boomers made out big.
“In an extreme seller’s market, older Americans who owned homes appeared to be the ones holding most of the cards in 2021,” Cox explains. “They were most likely to be the ones with big homes to sell, as many downsized or moved closer to family and friends.”
With skyrocketing home prices across the country, this specific demographic saw great success. Boomers also benefitted from rising stock values through 2021.
Fast fact: The average profit on a median-priced home in 2021 was $100,178
Investors
More money, more opportunity.
Even though inventory was down, 2021 saw a record-high number of investors making their presence in residential real estate. With huge funds in tow, many were able to easily outbid first-time homebuyers in the increasingly competitive single-family market.
Cox notes, “Many were capitalizing on the country’s massive shortage of homes, which isn’t expected to be resolved for the next few years.”
Fast fact: Investors made up 5.5% of all buyers in 2021—the highest since 2015
Folks who refinanced
Where do I sign?
Perhaps the most promising outcome of the pandemic were the rock-bottom interest rates. This was good news for mortgage hunters, but an even greater opportunity for existing homeowners hoping to refinance.
Per research from Realtor.com, “People who already own homes were able to shave $100—or more—off their monthly mortgage payments, ultimately saving tens of thousands of dollars over the life of their loans.”
Fast fact: In 2021, mortgage rates bottomed out at an all-time low.
THE LOSERS
First-time buyers
Trouble in paradise? So it seems.
Millennials setting out to purchase their first homes took a debilitating hit in 2021. Representing 34% of the buyer’s market, people between the ages of 25 and 40—many buying for the first time—were devastated by the lack of inventory.
“And don’t forget about bargaining power,” Cox says. “As more people than ever searched for homes, most buyers this year paid at least the full asking price.”
Fast fact: In 2021, first-time homebuyers paid 9.6% more for their homes
Austin, TX
Maybe everything IS bigger in Texas.
Sadly, that’s not good for Americans who moved there in 2021. Austin experienced immense population growth and even gained a new high-profile tenant in Tesla. But such a fast flood of people led to a severe housing crisis.
Cox explains, “The influx of buyers and low home inventory have sent median list prices about 50% higher in this metro area than what they were pre-pandemic.”
Fast fact: The ‘Live Music Capital of the World’ saw rents rise 30% this past year
Flippers
Flip? More like flop.
Unlike flashy investors leading with their back accounts, home flippers had a hard time in 2021. While the number of flips soared over the past year, profits sank to a shocking low due to the skyrocketing cost of lumber, appliances, and other construction materials.
“From April to June of this year, flippers made the lowest profits since 2008,” says Realtor.com.
Fast fact: Property flippers made 7% less profit on their investments in 2021
Renters
Good for landlord, bad for tenant.
First came the end of Biden’s eviction moratorium. And then, rent prices climbed sharply through the second half of the year. Oh—and did we mention the lack of supply? In 2021, renters simply couldn’t catch a break.
Says economist George Ratiu, “Landlords are in a position where they’re more than making up for the lost revenue and time by bringing rents to record highs.”
Fast fact: Rents are up an average of 9% across America
The Bay Area
This techie Mecca has always been notoriously expensive. Add some pandemic pressure, and things became even more bleak for the San Franciscan housing market. The city has also experienced some less-than-flattering headlines in recent months.
Cox says home appreciation forced buyers into outside markets: “When remote work became the norm for many tech workers…many looked for cheaper, nearby alternatives and made the move to places like Reno, NV, Seattle, and Phoenix.”
Fast fact: In 2021, 31% of residents left the city of San Francisco
Everest says: With us at your side, you always win