With the best housing year since 2007 behind us, real estate trends point to 2016 as an even better year, with economic growth and employment continuing their climb, offering people increased opportunities to upgrade their homes or buy their first one.
What real estate trends will have the biggest impact on the housing market in 2016?
Yep. That word we haven’t used to refer to the housing market in quite some time. Healthy growth will continue, but at a slower, more balanced pace than 2015.
2. Generational shuffles.
The rising wages of Gen Xers will allow them to step-up, while older Boomers seek to retire and downsize, providing much of the inventory Millennials will be on the lookout for. Representing one-third of the market in 2015, they are expected to dominate again this year.
3. More affordable new homes.
New construction will be trending toward more affordable, single family homes in 2016 (over the limited luxury market) as credit access improves.
4. Higher mortgage rates.
Rising rates will present a mixed-bag, with some mortgage volatility expected again in 2016. Thirty-year fixed-rates are predicted to end the year about 60 basis points higher than today. The increase will be manageable for most consumers – barring those in higher-priced markets, which are expected to slow. Mostly, however, the effect of rising rates will be minimal as buyers rush to take advantage of rates before they climb.
5. Rents outpacing home prices.
As renters continue to be crushed by rental rates exceeding 30% of income in more than 85% of rental markets, home prices are moderating. This is making homes more affordable to buy for those with a stable income, able to save a down payment, and with clean credit.
What’s does the future hold for you? With knowledge of up-and-coming real estate trends from Properties Online, you can come out ahead. Take advantage today!