As Home Values Climb, Property Tax Increases

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As home values appreciate property tax increases follow. According to ATTOM Data Solutions, This Week in Real Estate the average property tax hike in 2020 was the largest in four (4) years; totaling $323 billion levied against single-family homes. Additionally, the number of loans in forbearance programs has declined 51% since the spring of 2020. Below are a few newsworthy events from the first week of April that influence our business: 

One Year Later: How The Pandemic Has Shaped Today’s Housing Market. A year ago in March, the World Health Organization officially declared Covid-19 a pandemic, and shutdowns began across the United States and much of the world. The real estate market boomed in the suburbs and countryside. A surge in purchasing primary or secondary residences was fueled by lower mortgage rates, which plummeted last spring when the Fed cut rates to zero. We enjoyed the lowest rates of a lifetime with 30-year fixed rates plunging to a record low of 2.5% from nearly 3.625% in February of 2020, helping to fuel the real estate market. The success of the vaccines, easing of restrictions and the $1.9 trillion fiscal stimulus package has pushed mortgage rates up nearly .5% in the past several months. A rebounding economy and record government spending spell inflation, and that means higher rates. The average 30-year fixed is now at 3%, which is still a very low rate and has not had any impact on the purchase market. 

Forbearance Decline Largest in Six Months. Black Knight reports that the number of loans in forbearance programs declined last week for the sixth straight time and it was the largest drop in six months. As of April 6, the number of loans in active plans was 2.312 million or 4.4 percent of all homeowners with mortgages. This is down by 228,000 from the previous Tuesday, a 9 percent drop in a single week. This puts the number of active plans down by 323,000 over the last month – a 12.3% reduction and the strongest rate of improvement since early November. This is also a 2.45 million loan decline (-51 percent) from the spring 2020 peak.

Inventory Hits All-Time Low as Buyer Demand Explodes. The number of homes for sale sank to an all-time low in December, dipping below 700,000 for the first time ever, according to realtor.com’s Monthly Housing Trends Report. Homebuyer demand remains high, causing bidding wars for the few homes on the market. Home prices are up by double-digit numbers compared to a year ago. The number of listings has dropped nearly 40% from a year ago. That equates to about 449,000 fewer homes for sale in December 2020 compared to December 2019, according to realtor.com® data. Overall, list prices continued to increase in December 2020. The median listing price rose 13.4% year-over-year in that month to $340,000.  

Did you know every home listed for sale with Berkshire Hathaway HomeServices Northwest
Real Estate is eligible to receive no-obligation home warranty coverage from American Home
Shield or 2-10 Home Warranty the first six months the home is listed with our company?

www.bhhsnw.com

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