During a two-day policy meeting This Week in Real Estate the Federal Reserve reported the U.S. economy is heading for its strongest growth in nearly 40 years. Fed Chair Jerome Powell said, “we are committed to giving the economy the support it needs to return as quickly as possible to a state of maximum employment.” Below are a few newsworthy events from the third week of March that influence our business:
Millennials Dominate Buying Market, Generation Z Now Active Buyers. The popularity of multigenerational homes increased over the last year, as a rising number of homebuyers purchased larger residences compared to prior years, including millennials who continue to make up the largest share of homebuyers at 37%. Millennials have been the largest share of buyers since NAR’s 2014 report. The most recent data shows that 82% of younger millennials and 48% of older millennials were first-time homebuyers, more than other age groups. Sellers stayed in their previous home for a median of 10 years before selling, with a median of six years among sellers ages 31 to 40, and a median of 16 years among sellers 66 and older. Recently sold homes were generally on the market for a median of three weeks.
Fed Expects Growth Surge, Inflation Jump in 2021 But No Rate Hike. The U.S. economy is heading for its strongest growth in nearly 40 years, the Federal Reserve said on Wednesday, and central bank policymakers are pledging to keep their foot on the gas despite an expected surge of inflation. “Strong data are ahead of us,” a confident Fed Chair Jerome Powell said after a two-day policy meeting, ticking off the list of forces Fed officials expect will produce 6.5% GDP growth this year – from massive federal fiscal stimulus to optimism around the success of coronavirus vaccines. “The (stimulus) checks are going out … COVID cases are coming down. Vaccination is moving quickly,” Powell said, marking a moment in which a body of top U.S. economic officials expect growth in the United States to rival that of China this year, not to mention surging quickly beyond that of Europe and Japan. Fed officials, in fact, expect economic growth to remain above trend for at least two years to come, at 3.3% in 2022 and 2.2% in 2023, compared to the estimated long-term potential growth of just 1.8%. “We are committed to giving the economy the support it needs to return as quickly as possible to a state of maximum employment,” Powell said in a briefing after the Fed released its new economic projections and latest policy statement.
Strong Single-Family Permit Gains in January. Over the first month of 2021, the total number of single-family permits issued year-to-date (YTD) nationwide reached 83,921. On a year-over-year (YoY) basis, this is a 19.2% increase over the January 2020 level of 70,386. Year-to-date ending in January, single-family permits reported increases in all four regions. The relatively more affordable Midwest reported the strongest increase of 21.5%, followed by the Northeast (+20.7%), the South (+20.3%), and the West (15.1%). Between January 2020 YTD and January 2021 YTD, 46 states and the District of Columbia saw growth in single-family permits issued.
Did you know every home listed for sale with Berkshire Hathaway HomeServices Northwest Real Estate is eligible to receive no-obligation home warranty coverage the first six months the home is listed with our company?