Many home buyers used the coronavirus as an excuse to get away from it all. After the pandemic's initial onset, interest in small towns and rural areas spiked, as more Americans looked to move somewhere where they could have more space for the same money. The increased interest in suburbs and exurbs pushed price growth in those areas and soon their prices were outpacing urban neighborhoods. But while the trend continued through the end of 2020, the beginning of this year brought a change. Home buyers were, once again, looking to buy in bigger cities. Now, according to one recent analysis, urban single-family homes are showing price increases of almost 20 percent year-over-year. They're also getting more pageviews online. And, in both cases, they're outpacing properties in the small towns and rural areas that boomed last year at this time. The newfound interest in urban neighborhoods seems to stem from increasing optimism about the coronavirus vaccines and rebounding economy. But while buyers are looking at properties in the city, they haven't let go of their need for more space. In fact, single-family homes have been selling faster than condos – not just in cities, but in neighborhoods of all types.

The typical home sold in March was on the market for just 18 days, according to the National Association of Realtors' most recent existing-home sales report. That's down from 29 days last year at the same time. It's also a record low. Lawrence Yun, NAR's chief economist, says buyers remain active despite the market's fast pace this spring. “Consumers are facing much higher home prices, rising mortgage rates, and falling affordability, however, buyers are still actively in the market,” Yun said. “The sales for March would have been measurably higher, had there been more inventory. Days-on-market are swift, multiple offers are prevalent, and buyer confidence is rising.” There are several reasons home buyers remain active in the market, despite those challenges. Among them, an improved job market, still favorable mortgage rates, and the coronavirus vaccine lead the list. Buyers feel more optimistic about the economy and the pandemic and it's leading to strong demand for homes. If new home construction can keep up with demand and help hold home-price increases down, sales will only move higher as we head into summer.

In a normal year, homeowners who want to sell can strategize when the best time for them to list their home might be. For example, it's generally considered less optimal to put a home up for sale during the dead of winter or the holiday season. But with a pandemic and a lower-than-normal number of homes for sale, when's the best time for a homeowner to sell this year? Well, according to the National Association of Realtors' consumer website, the best time might be right now. “Unlike 2020 when COVID upended the spring home-buying season and pushed buyer interest to later in the year, this year's housing market is following more typical seasonal trends,” Danielle Hale, the website's chief economist, said. “With half as many homes available for sale this year than last, sellers are well positioned for a quick sale at top dollar.” In other words, buyers have returned to normal but the inventory of available homes has not. That means, home sellers should be in good position until the supply of homes increases. However, with so many unknowns ahead, waiting until later in the year bring its own risks. Which is why now might be the best time to make a move.

When there are more home buyers than homes for sale, that's a seller's market. Homeowners can get top dollar for their homes, since buyers have fewer options to choose from. That's the case in today's market. And, according to Fannie Mae's most recent Home Purchase Sentiment Index, Americans are noticing. In fact, the survey component measuring whether respondents think it's a good or bad time to sell a house saw a 13 percent increase in participants who said now is the right time to sell. Doug Duncan, Fannie Mae's senior vice president and chief economist, says Americans are becoming more optimistic and it's pushing home-selling sentiment higher. “The significant increase in the HPSI in March reflects consumer optimism toward the housing market and larger economy as vaccinations continue to roll out, a third round of stimulus checks was distributed, and the spring home buying season began – perhaps with even more intensity this year, since 2020's spring home buying season was limited by virus-related lockdowns,” Duncan said. “Home-selling sentiment experienced positive momentum across most consumer segments – nearly reaching pre-pandemic levels and generally indicative of a strong seller's market.”

One of the primary purposes of a house is protection from the elements. After all, we all want to feel safe at home – and shelter from harsh weather is a big part of that. But how many home buyers are thinking about extreme weather conditions when looking at listings? Well, according to one new survey, quite a few. In fact, nearly 80 percent of participants said the frequency and intensity of extreme weather in an area would make them hesitant to buy a home there. And, among respondents who said they planned to move in the next year, almost half said extreme temperatures and natural disasters played a role in their decision to relocate. Of course, how likely you are to factor extreme weather conditions into your buying decision has a lot to do with where you're looking to buy. For example, fewer respondents in the Midwest were thinking about extreme weather than in other regions. Similarly, younger buyers were more likely to take environmental factors into account when shopping for a house to buy.

Home prices have been increasing for a while now. But that doesn't necessarily mean homeownership is unaffordable. In fact, according to a recent report from ATTOM Data Solutions, buying a home in today's market is still more affordable than historical averages in 52 percent of counties. That means, a majority of the country's housing stock is within reach. Todd Teta, ATTOM's chief product officer, says low mortgage rates have helped. “The past year certainly has been an odd one for the U.S. housing market,” Teta said. “Home prices surged at a remarkable pace even as the virus pandemic damaged the U.S. economy, which dropped historical affordability levels. But average workers untarnished by the pandemic were still able to afford the typical home because wages and rock-bottom interest rates worked to their favor in a big way.” The report determined affordability by calculating the amount of income needed to pay homeownership expenses on a median-priced home and comparing it to average wage data. Among the 552 counties included in the report, counties in the Chicago, Houston, Dallas, San Antonio, and Detroit area were the most affordable.

When it comes time to make a move, you first have to decide whether you'll rent or buy your next place. For most of us, this decision is primarily a financial one. Surveys consistently show a majority of Americans say they hope to own their own home one day. Which means, many renters are doing so because they aren't financially ready yet to buy a home. It also means that, among current renters, there are many who are making plans to buy someday soon. And it seems, for an increasing number of them, that day has come. In fact, according to new research from Freddie Mac, renters were more likely than existing homeowners to buy homes last year, especially during the late summer and early fall. Additionally, Freddie Mac found that the likelihood that current homeowners would sell their homes has held steady at 18 percent since the beginning of the year, while the likelihood that renters would look to purchase a home has hovered around 35 percent. In other words, a lot of the current demand for homes is coming from renters who are now ready to buy.

Mortgage rates have recently started to increase again, after hovering at or just above record lows for months. And with most economists predicting the economy will boom – as more Americans are vaccinated and COVID-related restrictions are lifted – there is an expectation that they'll climb even higher. But despite those expectations, Fannie Mae's Economic and Strategic Research Group says it shouldn't be a major concern. “At the moment, economists' eyes are on interest rates given the size of the recent increases to Treasury and mortgage rates and the short time period over which those changes occurred,” Doug Duncan, Fannie Mae's senior vice president and chief economist, said. “Perspective is helpful here: While we forecast some continued upward movement, mortgage rates remain historically low, as they are still 0.8 percentage points below the 2019 average.” In other words, though rates have increased, they are still low when compared to what's been typical in years past. Fannie Mae expects any upcoming rate increases won't affect housing activity in the near term, though they do expect refinance demand to dip.

The typical home for sale was on the market just 20 days in February, according to new data released by the National Association of Realtors. That's a record low and down from 36 days last year at the same time. But while elevated demand from buyers plays a role, too few homes for sale is the chief reason homes are selling so quickly. The NAR's report shows that – while the number of homes for sale did improve month-over-month – nationally, it's down nearly 30 percent from where it was one year ago. According to Lawrence Yun, NAR's chief economist, low inventory is also contributing to declining home sales. In fact, February sales of existing homes fell 6.6 percent from January. “Despite the drop in home sales for February – which I would attribute to historically low inventory – the market is still outperforming pre-pandemic levels,” Yun said. It's true. Despite slowing in February, sales are still 9.1 percent higher than last year. And with expectations that both inventory and the economy will improve as the year goes on, there's hope that home sales and listings will too.