What a year it has been in the Real Estate industry with all it’s ups and downs, nonetheless as we start the new year in a couple of days here are the top 5 predictions experts want us to be prepared for the incoming new year according to Forbes magazine.
Mortgage rates will continue rising.
“Despite steady climbing for the past two years, mortgage rates remain lower than they were during most of the recession and below average for the type of strong economic growth we’ve been experiencing. That will change in 2019, as the 30-year, fixed rate mortgage reaches 5.8% territory not seen since the dark days of 2008 when rates were racing downward in response to the housing crisis.” Aaron Terrazas, director of economic research for Zillow
Millennials will keep buying homes (despite those rising rates)
“Millennials will continue to make up the largest segment of buyers next year, accounting for 45% of mortgages, compared to 17% of Boomers, and 37% of Gen Xers. While first-time buyers will struggle next year, older Millennial move-up buyers will have more options in the mid-to upper-tier price point and will make up the majority of Millennials who close in 2019. Looking forward, 2020 is expected to be the peak Millennial home buying year with the largest cohort of millennials turning 30 years old. Millennials are also likely to make up the largest share of home buyers for the next decade as their housing needs adjust over time.” Danielle Hale, chief economist for Realtor.com
Buyers will see less competition, but that might not help first-timers.
“Buyers who are able to stay in the market will find less competition as more buyers are priced out but feel an increased sense of urgency to close before it gets even more expensive. Their largest struggle next year will be reconciling wants, needs and budget versus the heavy competition of 2018. Although the number of homes for sale is increasing, which is an improvement for buyers, the majority of new inventory is focused in the mid- to higher-end price tier, not entry-level.” Danielle Hale, Realtor.com
Home price growth will continue to slow.
“Right now, for 2019, we believe home price appreciation will likely slow to near 3%. This is based on the assumption that the recent pattern of increasing inventory levels will be sustained in the upcoming year.” Gonzalez
Overall home sales will drop.
“As we look toward 2019, we are anticipating home sales to decline around 2%. We’re expecting it to be another slightly slower year as buyers continue to wrangle with higher mortgage rates after contending with several years of rapid price growth.” Ruben Gonzalez, chief economist at Keller Williams
With all that has been said and done do you think you and your clients will be ready for 2019?
Writer: Shaura Cuyan Shaura Cuyan writes about all the hottest Real Estate trends and predictions for Summit VA Solutions. She has previously written for a number of freelancing gigs and writes her own blog on lifestyle and current issues. She is a Graduate of Bachelor of Arts in Communication, taking up her Masters majoring in Development Communication.