What’s the latest in today’s real estate trends? Investors are out, millennials are in. And for those aching for a little balance in their real estate sales, the news couldn’t come soon enough.
Cash buyer, where art thou?
Investors, who previously peaked prices and sales thanks to a foreclosure feeding frenzy in which they could buy low and sell high, have walked away from the buffet table, balancing and normalizing the market for more traditional buyers – those mere mortals without thousands in liquid funds and in need of mortgages. This should slow home value growth from the 6 percent seen recently to around 3 percent, snagging negotiating power from the sellers and putting it back into the hands of buyers.
In upcoming real estate trends, millennials are expected to break away from social media and their iPhones long enough to scope out a place to crash and carry a mortgage on. By the end of 2015, they’ll represent the largest group of homebuyers, rising above Gen X-ers as they starts families and seek out more stability. And don’t expect similar buying patterns. Gen Y wants smaller, more urban centered dwellings versus the larger outskirts homes preferred by X-ers.
Has credit loosened, or will they have to sign in blood?
Turns out credit is indeed loosening, with Freddie Mac and Fannie Mae leading the way in easing mortgage eligibility. The pair has even announced a new program offering home loans to buyers with as little as 3 percent down in what is seen as an effort to extend credit to buyers “in a reasonable and safe manner.” Have a prospective millennial buyer with a job and 20 percent down? Go ahead and smack the “That Was Easy” button!