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A new year may be upon us but the housing industry's success of 2020 is still as impressive as ever. Zillow reported that U.S. housing gained nearly $2.5 trillion in value for 2020, the most in a single year since 2005, according to the report. That's not all, the company is predicting the possibility that 2021's gains may eclipse last year's exceptional gains.
With demand being at one of its all-time highs in 2020, driven by low-interest rates, homes were snatched off the market at the fastest pace Zillow has recorded. With inventory being swallowed up, the homes that were left on the market saw large price hikes. Zillow also noted that the Millennial generation aged into prime first-time homebuying age.
"2020 was a record-breaking year for the housing market with intense competition among buyers driving up home prices," said Zillow economist Treh Manhertz. "While many faced financial hardships because of the pandemic, others fortunate enough to maintain stable income took a step back to contemplate what they wanted their home to be and hopped on Zillow to help find a place that filled their wish list. Builder confidence, perhaps in reaction to the boosted demand, hit record highs and more homes are being built as a result. Add that together and you see why the housing market gained more than in any year since the Great Recession."