2017 and 2018 were a whirlwind for the real estate world. Home prices skyrocketed and we saw an entire generation begin to purchase their first homes. So, what can we expect to see in the xoming year? Read on to learn a few real estate trends you can anticipate seeing in 2019.
Home Prices are Slowly on the Rise
You may have heard that home prices jumped around 10% between 2017 and 2018. While home prices are still expected to increase in the next year, it will likely be at a much slower rate– closer to 1%. There is some good news, however: is looks like new home construction will increase about 8% in the next year. This does not guarantee that you’ll be able to purchase a home in your dream neighborhood, though. Some areas are filling up quickly, and there may not be enough homes to go around in some areas. Therefore, you should expect new home construction prices to be on the rise in the coming months.
So, what does this all mean for you? If you’re a seller, you’ll want to make sure your home really stands out in your neighborhood. Keep up with who your competition is, and do your research on what types of offers you should expect for your home. If you’re a buyer, it’s important to remember to stay within your budget. Crunch the numbers and only make an offer on house you know you can afford. If your dream home is still out of reach, keep saving and trying expanding your search or making some tradeoffs as you hunt for houses.
Expect Mortgage Interest Rates to Increase
Mortgage interest rates are on the rise — by about 5% for a 30-year mortgage and about 4.4% for a 15-year mortgage. This will be the highest they have been in about seven years. Don’t be alarmed, though: this means the economy is actually in good shape, and more people are willing to spend and borrow money right now.
If you’re looking to buy a home soon, be smart about what type of mortgage you decide to take out. 15-year mortgages are always recommended, and will usually get you a lower interest rate.
If you can’t pay for most (or all) or your home in cash, this is the preferred type of mortgage. If you’re a seller, you might find that your home will be on the market for slightly longer that initially anticipated. Increase mortgage rates will make people want to double and triple check their options, which might lead to a longer decision-making period for buyers.
Millennials have Entered the Housing Market
In 2019, millennials will take the lead in the housing market. As they get older and their income increases, they are looking to settle down and purchase homes in middle and upper class neighborhoods. You can expect millennials to account for about 45% of the housing market in the coming year — more than any other generation. This is all in their favor, as baby boomers and Gen X begin retiring and downsizing.
Millennials are very internet savvy, and prefer to do their research ahead of time. If you’re selling your home, make sure you have as much information as possible about your house available online. Millennials also tend to be more concerned with location and quality of the home over size. If you’re a millennial looking to purchase your first home, know what you want
and hire a professional. The majority of millennials purchasing homes in the last year hired real estate agents to aid in their search.