Top Real Estate Trends to Look Out For in 2021
In any industry, predicting trends and preparing for changes in consumer habits is key to staying ahead. This can be done by analyzing historical data, staying on top of current events, and understanding basic consumer behavior. In real estate especially, looking ahead is crucial for agents looking to strategize a plan of attack for the upcoming year.
With so much competition, the sooner realtors prepare themselves for what’s to come, the better chance they have of better accommodating the needs of their prospective clients. With that in mind, we’ll discuss a few of the major real estate trends to expect in 2021.
Understanding Real Estate Trends
Predicting the real estate market and everything that comes with it is not an easy task. Especially in today’s technological climate, where new business models and applications continue to disrupt entire industries left and right.
Understanding real estate trends can help today’s agents proactively adjust their approach and expose potential opportunities in the new year. With so many agents looking to capitalize on the growing homebuyer market, the ones that are fastest to adapt to industry demands will be most successful.
From millennial purchasing power to the increasing demand for smarter homes and greener solutions, here’s our list of the trends that could transform the real estate market in the new year.
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Emerging Real Estate Trends in 2021
Rising Trend of Downsizing
In a business enterprise, downsizing commonly refers to reducing the number of employees on the payroll. However, in real estate, downsizing doesn’t carry the same negative connotation and is commonly referred to as rightsizing. It’s a movement that revolves around individuals looking for a simpler, less materialistic way of life.
The point is to buy functional homes that meet the owners’ needs and satisfies their way of life, without any excess. There are a lot of proven, effective ways to downsize, and there are even more ways why buyers might be compelled to do so in 2021. Here are some:
- Less space, less stuff: We all know how tempting it is to fill a large room with all kinds of stuff. Having less space means owners are less likely to buy things they don’t need, putting more thought into what they bring home to decorate.
- It can be more intimate: The less space a home has, the more intimate the environment feels. Individuals that are looking to downsize want a home that speaks to their personality.
- Easier to design and organize: Less work leads to less stress. When designing a smaller home, the process is more manageable, the results are more tangible, and you can make headway much quicker.
- More savings: Minimizing space means maximizing your wallet. Fewer square feet means less furniture, less unnecessary clutter, and more functional spaces that save money in the long run.
As a real estate agent, it’s going to be your job to make it easier for clients to downsize. There will likely be a bunch of queries coming your way, so it’s important to understand why in some cases having less is more. Remember, realtors aren’t just selling homes, the business is also about helping people as they navigate through life changes and very important decisions for their future.
Millennials Buying Homes
In a report earlier this year by the Ellie Mae Millennial Tracker, 89% of mortgage loans made to millennial borrowers in July were for new home purchases. That’s up by a huge margin from the year prior. In addition, Inc. Magazine noted in 2017 that 66% of millennials plan to buy a home in the next 5 years. We’re entering the third year of that which means millennials have more purchasing power than ever.
According to top-performing Denver realtor, Denise Fisher, one thing real estate agents must adapt to when catering to their millennial clients is dealing with two sets of buyers for the same home. She explained that while millennials are usually the ones to research and vet the property online, there’s a huge tendency that parents will eventually get involved in the buying process.
Real estate agents must also adapt to how these younger buyers are searching for homes. It’s time for agents to start really utilizing tools like social media and PPC campaigns to showcase the properties they offer.
Understanding how today's buyers are searching for information and making purchase decisions can help agents tremendously in 2021. Little things like learning real estate photography to upload quality photos to highlight certain aspects and places within the community that may appeal to millennials will make a world of difference when selling to these prospective buyers.
If you haven’t done it already, it’s also best to also keep up with local trends and regulations through real estate continuing education. The caveat, of course, is that you can simply do this online too. Less hassle, more sales.
Technological Transformation in Real Estate
There will be an influx of buyers in 2021 who are looking to infuse the latest technology into their homes. Rapid urbanization along with population growth will propel the real estate industry as expected in the upcoming years. But along with those, technology, especially in this digital era will play a bigger role in the industry.
Technology has already transformed the process of home buying, as we've gone from reading print ads to using mobile apps in a matter of years. Now it’s expected to come in with a bigger influence in 2021’s housing trends.
- Smart and automated home: While some technology is for entertainment purposes only, some innovations can redefine the way people live and manage their homes. Knowing how to sell these to prospects will help agents improve their portfolios and tap a new market of buyers.
- Greener and healthier homes: Greener and smarter home ecosystems will be a hit for the increasingly environmentally-conscious generation. Owners would like such innovations integrated so they can enjoy efficient energy usage, cost savings, and futuristic design.
- Digital sales and transaction: It’s not just the way properties are marketed, experts say that more transactions, including purchases, are expected to be conducted much more often online in the years to come.
Knowing the Real Estate Trends for 2021
Millennials and the technology that comes with their generation has already made a huge impact on the real estate industry, and continue to change the way today’s agents operate. Gone are the days where buyers would go out of their way to see multiple properties themselves. There’s now a much simpler way to compare homes and the pressure is on the realtors to adapt.
In closing, it’s important for real estate professionals to not just simply follow the trend, they must spend quality time to understand why and how these changes take place. It is, after all, part of a realtor’s sworn obligation to keep learning the trade and evolve along with the real estate industry.