Welcome to the beginning of a new decade! Although it is impossible to predict the future, by going over the latest market trends experts can use this information to provide some insight on what to expect in the months ahead. There have been several significant changes over the past 15 years that indicate a steady housing market today.
• First-Time Buyers Toss Their Hats in the Ring: First-time buyers comprised 33 percent of all homebuyers. Many older millennials (ages 29 to 38) are getting into the market. Lower rates make a monthly mortgage more appealing than the monthly rent, encouraging young people to purchase a home and build equity.
• Existing Home Sales Looking Up: Existing home sales increased in 2019. Buyers took advantage of low interest rates, leading to more homes being sold. It’s a good time for sellers, with homes spending about a month on the market.
• Home Prices Continue to Rise: Home prices crept up slowly year-over-year in 2019. Inventory is still tight, contributing to a steady increase in prices. Despite this steady increase, historically low mortgage rates make the monthly payment more affordable.
With rising housing demand and a projected slight uptick in inventory, economists forecast that home sales will be slightly higher at 5.98 million in 2019 and reach near-2017 levels of 6.03 million in 2020. As stated above, much of the high demand in the housing market lately has been coming from young adults. Almost half of the millennials over 30 years old have bought a house in the last three years. These folks are increasingly looking to move out of urban centers in favor of the suburbs, which offer more privacy and a greener environment.
Perhaps most significantly, nearly 80 percent of millennials are confident they will become homeowners in the future. Add to that the new home market entering the pipeline: Housing starts and building permits surged to a more than 12-year high in mid-2019 and new-home sales rose above 700,000 as more home buyers weigh new-home construction.
I would be honored to share more market updates and serve all of your buying and selling needs in the coming year. At the end of the day, real estate is local, and I would be happy to walk you through what’s going on and how it applies to you. I am here for you, please reach out.
Until next week….