SEATTLE, Dec. 16, 2020 /PRNewswire/ -- Home became more
important than ever in 2020. Kitchen tables were repurposed as
classroom desks, basements turned into home offices and backyards
became sanctuaries. Those changes sparked the Great Reshuffling, as
many searched for a new home that would better fit their evolving
needs.
For some, home became more unstable than ever. The pandemic's
economic impacts disproportionately hurt renters, young adults,
women and minorities, increasing the risk of housing insecurity for
many Americans.
For others, 2020 opened up new housing opportunities. The
freedom to telecommute allowed renters in pricey cities to
potentially become homeowners in more affordable markets, and
offered the possibility to turn a favorite vacation destination
into a hometown. Record low interest rates brought first-time
buyers to the market, and refinancing made homeownership more
affordable.
The pandemic also changed the way people moved, cementing the
preference for a digital-first experience. Digital tools like 3D
Home virtual tours and self-tour technology enabled faster, safer
and easier home shopping for buyers, while renters could search,
find, apply for and lease a home digitally.
Here's a look back at the housing stories that moved us in
2020:
Remote Work Opened Up New Housing Options
The rise of remote work could be one of the most significant and
enduring shifts in the post-pandemic world, and strongly impact
future housing preferences. A Zillow
survey[1] from the Harris Poll found
two-thirds of those working from home during the pandemic said they
would consider moving if given the option to continue working
remotely, at least occasionally.
Working from home was more appealing near the water, the beach
or the mountains. Page views of for-sale listings on Zillow in 20
popular vacation destinations were up nearly 50% from last
year.
The freedom to telecommute also opened up the American Dream of
homeownership to nearly two million renter households who couldn't
afford a starter home in their expensive metro, but could afford
monthly payments on the typical U.S. starter home. Black renters
could benefit the most: they are 29% more likely than other renters
to potentially afford a first home because of the rise in
telework.
Sky-High Demand Drove the Red Hot For-Sale Market
The for-sale housing market was driven to new record highs by
intense demand. Buyers returned to the market in force this summer,
while uncertainty kept many potential sellers on the sidelines,
creating intense demand for tightening inventory. One in five homes
sold above list price and homes flew off the market at their
fastest pace in more than two years.
Zillow expects robust demand to continue well into 2021, driven
by the Great Reshuffling, low mortgage interest rates and
demographic shifts as millennials age into their home-buying
years.
A Digital Revolution in Real Estate
2020 cemented the shift to eCommerce in many industries,
including real estate. New technology was rapidly adopted to help
people safely move on to life's next chapter. The creation of
Zillow 3D Home virtual tours spiked this spring, up 750% in the
month after many stay-home orders went into effect, and remained
around twice as high through late November. Integrated floor
plans augmented the shopping experience and allowed buyers to
better understand a home's layout. Real estate agents offered video
tours in lieu of private showings or open houses.
Digital tools improved the in-person tour experience, too, with
the accelerated rollout of self-tour technology that lets shoppers
tour a vacant Zillow-owned home in person on their own
schedule.
An all-digital rentals transaction allowed renters to search,
tour, apply for and lease a rental all from the comfort and safety
of their living room.
The Urban Exodus Myth
Early reports that homeowners were fleeing cities turned out to
be premature. Zillow's data found suburban housing markets were not
outperforming urban housing markets. The notable exceptions were
New York City and San Francisco -- where the housing markets had
been softening prior to the pandemic.
Zillow did find a divergence in the rental market, where rent
price growth slowed significantly nationwide. However, rent price
growth in urban ZIP codes slowed more than those in suburban
areas since February, an outcome of unemployment affecting urban
renters particularly hard and a possible signal that renter
preferences are inching toward the suburbs.
The Pandemic's Uneven Impact
Renters were hit the hardest by the pandemic and the
expiration of added unemployment benefits in late July. Not only do
renters typically have higher housing-cost burdens and lower
incomes, they are more likely to be in high contact-intensity
occupations. While a federal eviction moratorium remains in effect
through the end of the year, renters were not able to defer housing
payments in the way mortgage forbearance programs helped offer some
protection to homeowners.
Women and minorities were especially vulnerable to
COVID-19-related job losses and, in turn, are at greater risk of
housing insecurity. Young people were also hit with higher
unemployment rates, prompting nearly three million young adults to
move back home with family in the spring. Gen Z renters slowly
started returning to the rental market this fall, enticed by rental
concessions like free rent or parking.
Changing Home Preferences Sparks Zillow Surfing Trend
The pandemic forced a reckoning for homeowners about what they
really need and want, prompting many to go Zillow surfing for a new
home. Traffic to for-sale listings on Zillow surged more than 50%
in May and continued to reach new year-over-year highs in the
months that followed.
Privacy became a luxury as families found themselves living,
working and schooling under one roof, prompting home builders to
predict the demise of the open floor plan.
As people settled into remote work, for-sale listings on Zillow
mentioning a home office in their listing description jumped 10%. A
Zillow survey[2] found getting a home with a
designated office space was the top reason why employees working
remotely say they would consider a move if they could continue
occasionally working from home.
More than 40% of Americans[3] said they
valued a well-equipped kitchen and a large outdoor space more as a
result of social distancing recommendations, a sign home shoppers
will be seeking out these features in 2021.
For more stories, trends and data on What Moved Us in 2020,
click here.
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate
to make it easier to unlock life's next chapter.
As the most-visited real estate website in the U.S., Zillow® and
its affiliates offer customers an on-demand experience for selling,
buying, renting or financing with transparency and nearly seamless
end-to-end service. Zillow Offers® buys and sells homes directly in
dozens of markets across the country, allowing sellers control over
their timeline. Zillow Home Loans™, our affiliate lender, provides
our customers with an easy option to get pre-approved and secure
financing for their next home purchase. Zillow recently launched
Zillow Homes, Inc., a licensed brokerage entity, to streamline
Zillow Offers transactions.
Zillow Group's affiliates and subsidiaries include Zillow®,
Zillow Offers®, Zillow Premier Agent®, Zillow Home Loans™, Zillow
Closing Services™, Zillow Homes, Inc., Trulia®, Out East®,
StreetEasy® and HotPads®. Zillow Home Loans, LLC is an Equal
Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org).
[1] This survey was conducted online
within the United States by The
Harris Poll on behalf of Zillow from May
4-6, 2020 among 2,065 U.S. adults ages 18 and older. This
online survey is not based on a probability sample and therefore no
estimate of theoretical sampling error can be calculated. For
complete survey methodology, including weighting variables and
subgroup sample sizes, please contact press@zillow.com.
[2] See footnote 1
[3] See footnote 1
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SOURCE Zillow