Property price trends have changed massively lately, especially in the wake of a worldwide coronavirus outbreak.
The pandemic, among everything else, brought some surprising changes to the real estate market. Until recently, to buy a house, you needed an excellent credit score and mortgage approval. Now, the market is overflowing with properties, banks are generously giving out loans, and all you need is to find the right house.
To ease your search, we have gathered the vital property price trends and the most exciting experts’ predictions for 2022.
For those of you more interested in house flipping or home improvement, keep reading to find out which practices yield the best results.
Informative House Price Trends (Editor’s Picks)
- The US real estate market gained $2.5 trillion in 2020
- The average house price for the last quarter of 2020 was $346,800
- 30% of home buyers paid above the initial asking price.
- California accounts for over a fifth of the total US housing value
- All houses in the New York metro area are worth over $3 trillion combined
- Almost 6% of all sold houses in 2020 were flips
- Move-in-ready home is the preferred choice for 80% of the buyers
- Smart home upgrades will make 29% of people more inclined to buy the house
General US Housing Market Trends
Before we get to the more specific trends, we have to cover the basics. Let’s take a look into the US housing market value, sale predictions and prices, and more.
1. The US housing market gained $2.5 trillion in value in 2020.
(Zillow)
Value gain in 2020 was the highest one recorded in the last decade and a half. Around $2.2 trillion was due to sales of existing homes, while $274 billion came from new constructions.
2. Experts predict existing-home sales to reach 7 million in 2022.
(Zillow)
Housing market forecast 2022 predicts a 22% increase in sales. Thanks to the low mortgage rates and rising demand in the first half of the year, there’s a good chance 2022 will be a record-breaking year.
3. The average price for a house in the last quarter of 2020 was $358,700.
(FRED)
For comparison, in the last quarter of 2019, the average house price in the US was $327,100, while in 2018 — $322,800.
4. 15% of home buyers had to pay above the asking price to get the house they wanted.
(Statista)
In 2019, 27% of the Millennial buyers and 31% of the elderly, aged between 74 and 94 years, paid more than the asking price to outbid for the house they wanted.
5. Land prices increased by 4% in 2020.
(NAR)
Property price trends show higher demand for land properties since the beginning of the pandemic, especially for residential, industrial, and ranch land.
6. Commercial property sales declined by 5% in the second quarter of 2020.
(NAR)
Trends show decreased sales and prices for most commercial properties — offices, retail centers, and malls.
7. The median home prices more than doubled in the last 20 years.
(DQYDJ)
A house price graph of the last 20 years shows the median home price in January 2001 was around $140,200 in inflation-adjusted numbers — the actual one was $208,600. Fast forward to 2010, and home prices were slightly lower — the median value was $217,400.
House Price Trends in the Different States
We gathered the most exciting housing info on the average house price by state for everyone to take their real estate knowledge to the next level.
8. Over a fifth of the US housing value is in California.
(Zillow)
Housing market trends by zip code show that the most expensive houses are in California. Not only that, but four of the ten most valuable metro areas are there, too — Los Angeles, San Jose, San Diego, and San Francisco.
9. Houses in California are worth $7.8 trillion, all combined.
(Zillow)
The average house cost in California, the largest, and not necessarily the safest state in the US, is around $668,300.
10. With $64 billion, North Dakota has the smallest share of the housing market.
(Zillow)
The housing value of Wyoming is around $70 billion, while South Dakota is worth $72 billion. The three states are the least-populous, which directly affects their share of the housing market.
11. The housing stock in Alaska was the only one that went down in 2020.
(Zillow)
Alaska was the only state with no average home value increase per year and even lost value by 1.8% — about $1.5 billion.
12. The value of the housing stock in Idaho has increased by 149% in the last ten years.
(Zillow)
The real estate forecast for the next 5 years for Idaho expects the stock to continue rising, mainly in the Boise metro area, where it has tripled its value. Nevada, Utah, Arizona, Washington, and Colorado also showed a significant increase.
13. Houses in the New York metro area are worth over $3 trillion in total.
(Zillow)
New York still has the highest housing value for a metro area in the US. Los Angeles comes in second with $2.8 trillion, followed by San Francisco with $1.7 trillion.
Home Buying Trends — House Flipping
Have you heard of house flipping? It’s a process of buying a property, redoing it, and selling it for a significant profit. It presents an opportunity for those who like renovating and are on the lookout for a new project.
14. In 2020, almost 6% of sold houses were flips.
(Million Acres)
House flipping isn’t a new trend, and its popularity has remained stable in the last three years, housing price trends show.
15. The average gross profit from flips in 2020 was around $66,300.
(Million Acres)
The first quarter of 2020 was one of the least profitable times to flip a house, with a total of $62,000 profit. Similarly, in 2019, housing price data shows that the gain was around $63,000, and in 2018 — $65,000.
16. With a gross ROI of 92.6%, Pennsylvania is the most profitable flipping market.
(Million Acres)
House flipping in Pennsylvania had the most return on investment, followed by Ohio and Connecticut.
Home Appreciation Rates & Improvement Stats
External factors are not the only thing boosting rates — certain internal improvement features can make the house more attractive for potential buyers.
The following stats reveal what is worth investing in and what can be skipped.
17. 80% of people prefer buying a move-in-ready home.
(Coldwell Banker Real Estate LLC)
A survey on property value trends showed that most people are unwilling to do extensive work on the house they are about to buy.
Additionally, 67% of the homebuyers are willing to sacrifice the size of the home to find a move-in-ready one within their budget.
18. 29% of the people list ‘smart home technology’ as a primary reason when choosing a house.
(Coldwell Banker Real Estate LLC)
Smart home modifications are proving attractive to more and more people. While it’s a significant investment, it’s also a way of improving both your lifestyle and home value.
Other potential buyers’ attractions, according to home value trends, are granite countertops — 37%, and a designated home office space — 34%.
19. 63% of people prefer buying a home with a master suite.
(Coldwell Banker Real Estate LLC)
A master bedroom with a private bathroom is a lovely, desired addition to a home. In that line of thought, 36% of potential buyers prefer to have double sinks in the master bathroom.
20. 51% of potential buyers are more likely to buy a house with a fenced backyard.
(Coldwell Banker Real Estate LLC)
On average, homeowners spend around $1800 on fence installation, real estate price trends indicate.
Another feature you might want to consider is hardwood floors. In fact, 46% of the people claimed they are more likely to buy a house due to that characteristic. On the other hand, carpeting would be the preferred choice for 23% of the people.
Final Thoughts on Property Price Trends
We made sure to include everything you need to know and more about property prices. Hopefully, our stats on the housing market and home flips and improvements will help you make the right choice, regardless of whether you are selling or buying.
Above all, when deciding on a house to purchase, make sure to look at the area prices, the recent changes in the market rates, and the amenities the property has. Consulting an agent or website can make the process of finding the best option in a much more straightforward manner.
People Also Ask
A rapid price rise was the expected trend due to low mortgage rates, higher demand, and lower supply. However, experts predict a slow drop in house prices by the end of the year.
While mortgage rates are hitting a record low, house prices are on the rise, and the demand is higher. The answer depends on where you are looking to buy, your savings, and your income. Experts confirm that now is a great time to make an offer.
It usually costs between $100,000 and $200,000 to build a 1000 sq ft. If you add another 500 sq ft, the cost will be between $150,000 and $300,000.
Experts believe that a housing crash isn’t probable at this moment. Rising prices are not the only indicator of a housing crash, as there are over ten warning signs to watch for.
Generally, November is the time to get the best value for your money. On the other hand, spring brings more houses to the market. So, in April, you are likely to have more options to choose from.
That depends on your preferences, as well as where you are from. Most people believe that owning a house is a much better option than renting. However, considering the sale prices and the price-to-rent ratio, currently, it appears better to rent.
If you want a cheaper house, you will need to build something smaller with more affordable materials. Property price trends show that one-story houses, shipping container houses, and especially ranches are excellent money-saving options.
Moreover, you could choose cheaper materials like reclaimed wood, concrete sheets, and used brick. Plywood, bamboo, and corrugated metal are also functional, affordable options.
