Brad O'Connor directly addresses camera: Florida's housing market kicked off 2021 right where it left off at the end of 2020, based on the January statistics just released by Florida Realtors. Statewide, closed sales of existing single-family homes were up 18 percent year-over-year in January, which if you can believe it is the *lowest* percentage growth rate we've reported for closed sales in any month since August. It could be that we're gradually running out of all the pent-up demand that built up when the onset of the pandemic washed out our normally busy spring buying season last year, but it's also worth noting that sales were particularly strong last January, as well. So, it would have been difficult for us to post a year-over-year growth percentage on par with what we saw in the closing months of 2020, when we were up around 22 percent, 27 percent, 23 percent, and 21 percent in September, October, November, and December, respectively. Year-over-year sales growth in the condo and townhouse category continued to significantly outperform single-family sales growth in January, rising by close to 25 percent. But this also represented a mild decline from the growth percentages we reported in the latter months of 2020, down from a nearly 28 percent rise in December. Still, it goes without saying that 18 percent year-over-year growth in single-family sales and 25 percent growth in condo and townhouse sales is way, way above our historical average - and we will likely *remain* well above our historical average for most, if not all, of 2021. The primary reason for that is that mortgage rates will continue to remain quite low for the duration of the year. The Fed, for one thing, has repeatedly signaled it intends to pursue a monetary policy agenda that ensures this will be the case. That said, economic forecasters have reached something of a consensus that mortgage rates have finally reached a bottom. Interest rates are, of course, notoriously difficult to forecast, so you never really can be sure exactly where they'll be 12 months from now - but then again, that's a reason to take notice when everyone's forecasts actually agree on something. However, there is still some mild disagreement among prominent forecasters in terms of how fast rates will rise from here - although again, no one is currently predicting that rates are going to rise too significantly. The average 30-year fixed mortgage rate most recently hit a record low in the first week of January and has not strayed far from about 2.7 percent since that time. The latest baseline forecast from the National Association of Realtors predicts that the 30-year fixed rate will rise over the course of the year, averaging about 3.0 percent. The economists at the National Association of Home Builders, meanwhile, are similarly predicting an average of rate of about 2.9 percent over the same time span. So given that we're currently below 3 percent, both of these forecasts would put us somewhere in the neighborhood of 3.2 or 3.3 percent at the end of the year, assuming growth is steady. Realtor.com's economists also recently issued a forecast of their own, predicting that rates will remain in the neighborhood of 3 percent in the first half of the year before rising to 3.4 percent by year's end. The Mortgage Banker Association's forecast, meanwhile, has rates rising all the way to around 3.6 percent by year's end. But other forecasters are predicting that the rate increase will probably be slower than this. Economists at Freddie Mac have forecasted that rates won't even reach 3 percent until near the end of 2021, while CoreLogic's economists are currently forecasting that rates will stay below 3 percent for early 2021 and will only average 3.2 percent over the next three years. Fannie Mae's forecasts, meanwhile, are some of the most optimistic we've seen in terms of rates growing slowly-their baseline prediction is that the 30-year rate will only be up to 2.8 percent in the fourth quarter of 2021 and won't reach 3 percent until the end of 2022. The difference between this forecast and the Mortgage Banker Association's forecast of a 3.6 percent rate at the end of 2021 might not seem too significant to the average person, but those of us who follow real estate markets know that a difference of over 6 basis points is kind of a big deal. If we end up at 3.6 percent at year's end, I still think demand will be strong, but it will fall back closer to the historical trend. Over on the supply side, last year's decline in active listings of existing homes for sale continued into January. Now, I've been making an effort recently to point out that year-over-year growth in new listings - at least on a statewide basis - was positive over the second half of 2020. It's just that the pace of sales has been so phrenetic that these new listings have not replaced enough of our inventory to reverse the trend. But in January of 2021, new listings of single-family homes were down over 10 percent year-over-year in what is normally a strong month for new listings. Likewise, new listings of condos and townhouses were down statewide by almost 7 percent. We'll need to keep an eye on new listings for the next few months to see if this is really a downshift or just a one-time decline. But it's plain to see that the lack of new listings really hurt us in the inventory department. At the end of January, the statewide inventory of single-family home listings was down over 51 percent compared to a year ago, while condo and townhouse inventory was down over 26 percent. With the continued lack of inventory in the face of strong demand, year-over-year growth in median sale prices was once again in the double-digits, percentage-wise. The single-family home median sale price was up just over 15 percent to $305,000, while the condo and townhouse median sale price rose 15 percent to $230,000. As I've said before, these growth rates are being skewed upward by the larger share of luxury home sales we've seen since the housing market began to rebound last year. But actual home price appreciation remains a significant component of this growth in median prices. As always, we encourage you to analyze the numbers for your area to help your buyers and sellers understand what's going on locally. And to find statistics for your local market, all you have to do is visit floridarealtors.org/research. And of course, don't forget to check out our new interactive market data tool, SunStats, which is exclusively for use by Florida Realtors members. You can access SunStats directly at sunstats.floridarealtors.org. Take care, everyone. See you next month.