In the 4th and final installment of the 2020 Southwest Florida Real Estate Market Report we cover where things are going, and things to keep an eye on for 2021. Remember, to request a full PDF copy of this guide contact me today!
What’s Coming in 2021?
Increase in Home Values in 2021: As we approach 2021, home values are projected to climb anywhere from 3% to 6% nationally. Federal Housing Finance Agency (FHFA) released its latest Home Price Index and the report showed home prices actually rose 6.5% from the same time last year. FHFA also noted that price appreciation accelerated to record levels over the summer months: the largest two-month price increase observed since the start of the index back in 1991.
It’s my opinion that barring any unforeseen major political upset or other blackswan event that properties throughout Southwest Florida will rise much higher than national averages. I fully expect that by the end of 2021, home prices to be 10% higher than they are today. I have seen first hand, with my own home, and the homes of 2 clients in Estero for example, already increase 25%+ in the last 12 months.
Interest Rates: Many people don’t realize that in September of 2019 the first real “crisis” began that was one the impetus (or cause) for the COVID project. What happened? The intra bank lending markets (aka – the REPO Markets) collapsed immediately following the FEDs ending of quantitative easing. Banks and Hedge funds completely ran out of liquidity the second QE ended, and wouldn’t lend to each other (even at rates as high as 10% per day)!
There is no way the FEDs raise rates in the foreseeable future, unless there are large corresponding inflows of money coming through the back door, and one of the problems with this, is the FED is quickly saturating all need for that through indirect purchase of securities, and it’s purchases in the bond markets. Unfortunately with the “Great Reset” looming – a DAVOS and WEF (U.N.) lead initiative to essentially reset the world, with the largest change being a toppling of the dollar’s worldwide hegemony – this is truly the wildcard in play. Regardless the FED is backed into a corner and rates will (almost assuredly) not rise. Although unlike in Europe and some parts of Asia, the United States will NOT have negative interest rates (as they’ve not worked at all for the countries and territories that have implemented them).
Sellers Market Continues: There is simply too much demand nationwide and FAR too much demand locally for builders to fully catch up to demand in real time. This is why I expect the sellers market to continue through 2021.
COVID-19: For those doing independent research, we know that things aren’t as scary as the largest media outlets would have you believe – as alluded to in the FED policies section, as well as the mention of the “Great Reset” – this is a large project to help remake the world underneath a new supra-governmental body (under the guise of health and science – an indisputable fact if you read Klaus Schwabb’s “The Great Reset” – Schwabb being the chairman of the World Economic Forum). It’s my hope that most people realize this and shake off the fear they’re selling. Longer term, if this is not done, and the world is sold wholesale on the idea of recurrent world ending diseases, the institutions that have been, and will be, put in place to help “secure” life, businesses, people – may keep the economy running but represent the final nails in the coffin of personal responsibility, liberty, and independent thinking.
The bottom line? The housing market in Southwest Florida is hotter than ever (including the 2006/2007 market) we have beautiful weather, healthy/active lifestyles, enticing financial and tax benefits and much of the country (and even world) is currently looking to Florida as a refuge against what’s been happening for 2020. We’re truly positioned to explode in growth in the remaining weeks of 2020 and for the whole of 2021.