In November, looser credit conditions increased potential home sales by 54,000 relative to one year ago.
First American Chief economist Mark Fleming cites reasons housing will stay strong through 2021. “Strong underlying fundamentals shaped the housing market’s remarkable 2020 comeback story, helping overcome the pandemic-driven spring slowdown and ultimately fueling a record-breaking year,” he writes. “Add a vaccine to the story, and the stage is set for another strong year in 2021.” However, there is one down note: Credit Conditions. “At the height of the pandemic-driven housing market contraction in April, tight credit conditions reduced the potential for existing-home sales by over 900,000 sales relative to a year ago,” Fleming said. “As the uncertainty has subsided, credit conditions have loosened. In November, looser credit conditions increased potential home sales by 54,000 relative to one year ago. What lending standards will look like in 2021 remains unclear and will depend on economic conditions in the coming months.”
Source: Rise and Shred