Real Estate, Market Predictions, New Year, Home Search, House Hunt, Financing, Property, Millennials, New Construction
Posted: January 05, 2018 at 12:00 AM by Bailey Gordon
Wondering what the Real Estate Market is going to look like for 2018? We thought while everyone is enjoying this snow day and finding themselves with more time to read and house hunt, we would go ahead and focus today's Blog on some Real Estate Predictions for 2018! If you're thinking of buying or selling, investing or flipping, or you're just curious about the trends in general, this will be an interesting and informative read for you!
During our online research that we conduct pretty much on a daily basis in order to stay on top of housing trends and real estate marketing (and our social media guilty pleasures) we came across a predictions from experts across the country that we decided to research to show you what you can expect to see across the nation in terms of Real Estate this year!
As we head into the new year, everyone is asking "What can we expect from the market in 2018?"
Let's take a look at some predictions that help provide answers to that question!
In a nut shell our research led us to these top predictions: Property values will continue to rise, New construction will make Real Estate more accessible, Millennials will redirect their focus from urban living to the suburbs, those impacted by the housing recession will return to the market, New tax legislation could lead to more competition and fewer deductions and Interest rates are expected to rise.
Now, with those predictions in mind, we're going to break down how they could play into your own Real Estate situations.
With rising property values, current homeowners can be confident that their long term investment will continue to pay off over time. If you're in the market to buy this year, although property values are rising, the rate of appreciation has slowed. Even so, you'll still want to jump into the market sooner rather than later because prices will continue to rise!
Now onto inventory. With limited inventory being a consistent problem in recent years, new construction is predicted to make a big impact for potential homeowners this year and moving forward in years to come. With existing home inventory continuing to be near historic lows, many experts predict that the growth in sales will be driven by NewHome sales like single family construction.
This new construction is predicted to come with a catch for millennials. While millennials continue to remain one of the largest groups of home buyers, their urban living focus may need to be redirected toward the suburbs. With more availability of land and less zoning restrictions, most of the new construction will be located in suburban areas. As millennials come of age and begin to start families the demand for larger, more affordable housing will grow and single family construction in the suburbs could be where that growth occurs.
Now let's look at a completely different group of buyers the "Boomerang Buyers". This term is used to describe the nearly 10 million Americans who lost their homes to foreclosures or short sales during the recession. According to credit score guidelines, foreclosures can remain on your credit history for 7 years, which takes many people that long to raise their scores and save up money towards a mortgage. With that time frame in mind, 2018 makes a good year for those affected by the housing recession to re-enter the market now that the time frame for their credit scores to rise and the extra few years of saving toward a down payment have come to terms.
That brings us to the point of current legislation and how it will impact homeowners this year. The Tax Cuts and Job Acts legislation that was passed at the end of 2017 nearly doubles the standard deduction, so fewer Americans are expected to itemize this year. For those who do, it could mean less home owner deductions than in years before. While it is yet to be seen how this legislation will affect the market in 2018, current predictions show that more wealthy home buyers could see an increase in after tax income that could make an already tough housing market even more competitive.
As far as interest rates go, no one knows exactly what will happen with Mortgage Rates this year, but experts anticipate that the Federal Reserve will raise rates in 2018. What does this mean for buyers? If you're thinking of buying, act now! We would like to point out that rising interest rates will decrease your purchasing power, so you'll want to jump in sooner rather than later! If you're a current homeowner and you're considering an equity loan or refinancing, we suggest you talk to a lender for advice on when to act!
With these predictions in mind, we want to extend the offer of our services as far as guiding you on what 2018 could look like with your specific situation at hand. If you're thinking of buying or selling, we would love to earn the opportunity to sit down with you and go over your options, discuss a plan and assist you with your purchase or sale! We are always ready to jump in and dedicate ourselves to you and your family to help improve your Real Estate experience and we look forward to another great year in 2018!