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It’s 2021 and here is my crystal ball! Yes, it’s a bit murky and not always accurate! What has it told me about the housing market this year?

2021 will be all about 3 factors: demographics, the economy and the pandemic.


What’s so important about demographics? It’s big! The “Millenials” – are a huge generation -- people who are now in their late 20’s to late 30’s are at the prime age range for getting married/having kids/buying homes. Demographers estimate that almost 25 million NEW households will be formed between now and 2028.

The Silent Generation (80+ older) and the Boomers (55+) are living longer, healthier lives than their forbears – meaning that their homes are not available to be re-sold.


The stock market continues to fly high, and interest rates, which very much influence housing demand, remain at or below 3%, incredibly low. Many industries are still very profitable.

Lawrence Yun, chief Economist for National Association of Realtors, says that 2021 will be a strong market.

“Prices will rise about 5.7% in 2021” says Danielle Hale, Chief Economist of

Mark Fleming, Chief Economist of First American, says the big shortage in housing supply will continue into 2021 and likely keep house price appreciation flying high.”

Yet, unemployment continues to rise, especially in the service industries.

  • CORONAVIRUS – the Wildcard

Will vaccinations and safety protocols get people out & about? Will bars & restaurants, concert halls, Broadway, movie theaters, live spectator sports, weddings, travel, etc. be back on the scene along with all the jobs that were lost?

Strong economic headwinds due to the Virus are continually buffeting the economy.

Yet, despite it all the housing market seems to be moving along just fine.

The Bay Area is enjoying price appreciation and buyer demand. So many “knowledge workers” – those well paid jobs that don’t require a physical presence are driving a migration to the suburbs.

Contra Costa County – especially East County – Pittsburg, Antioch, etc. attracts plenty of first time buyers.

Prices actually rose over 8% in Pittsburg alone in 2020!

Although the new “shelter in place” orders are still in effect, buyers are happily viewing homes, wearing masks & sanitizing hands.

Interest rates are predicted to remain at or below 3% at least through the first half of 2021.

What could go wrong with housing?

  • The Virus

The toll on human life as well as the economy will continue to have an impact the longer the pandemic rages. Although vaccines are being distributed, many economists predict America won’t be getting back to a new normal until late summer.

  • The end of Forbearance Programs

In March 2020, Mortgage companies offered forbearance programs allowed affected homeowners to skip up to 12 months of payments and stay in their homes. Will the end of forbearance cause a wave of homes to come on the market? Or will the government extend relief to buy more time for homeowners to get back to work ?

  • Limited Supply

Continued tight supply of homes for sale hurts affordability. Even with low interest rates, price appreciation of 8% or more each year is not sustainable. Builders simply can’t build fast enough.


December Statistics Coming Soon!
November 2020 Contra Costa Market Report

So far, The housing market continues to be the shining star of the U.S. economy and California is enjoying it. Builders and construction workers are busy! Home improvement stores, general contractors, tradespeople such as painters, flooring specialists, landscapers can barely keep up with the work. Homeowners are taking $ they would have spent on entertainment or travel & making home improvements. The new Presidential Administration and Congress will likely discuss first time homebuyer tax credits or similar incentives.

The outlook is optimistic – tempered by the unknown trajectory of the virus. The next few months will be critical in determining how quickly the rest of the economy can recover during the second half of 2021.

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