How did the US real estate market fare in 2021?

The US real estate market in 2021 has been characterized by a strong seller's market with record-low inventory, high demand, and rising prices. The COVID-19 pandemic has played a significant role in shaping the market as people are seeking more spacious homes to accommodate work from home and remote learning situations. Additionally, low mortgage rates have fueled demand, resulting in bidding wars and quick sales.

According to data from the National Association of Realtors, home prices in the US rose by 14.9% in the last quarter of 2020 and continued to increase by 15.8% in the first quarter of 2021. The inventory of homes for sale dropped by 48.6% in February 2021 compared to the previous year, leading to fierce competition among buyers. The situation is particularly challenging for first-time homebuyers, who may face difficulties in finding affordable homes in desirable locations.

The real estate market in different parts of the country has performed differently. According to a report by Redfin, many cities, particularly in the South and West, saw double-digit price growth in 2021. At the same time, some urban areas, such as New York and San Francisco, have experienced slower price growth, and in some cases, a decline in prices. The market for luxury homes has also been robust, with high-end properties in desirable locations selling quickly and at record prices.