Everyone seems to have an opinion on what 2016 will bring for the real estate industry. However many are putting their money on the real estate trends forecasted by the six prominent economists in a recent Housing News Report. What are these monetary moguls betting on?
- Moderate home price growth and sales.
The economists interviewed were cautiously optimistic about home prices and sales overall. This is due to rental and homeowner vacancy rates that continue to decline, pushing up housing prices (and rents), particularly in affordably priced homes. The edging up of interest rates from historical lows by the Fed is also expected to spur fence-sitters into action.
- Who’s buying?
- Older millennials age 25 to 34 have the potential to claim one-third of sales
- Who’s supplying?
- Gen X’rs, whose income and families are movin’ on up.
- Older boomers looking to downsize and/or retire.
- New home construction, now geared toward single-family, affordable housing.
- Who’s buying?
- Rising rental rates.
Rents will continue to rise more rapidly than home prices. While this will reinforce the desire to buy, the burden of high rental rates will prevent many from saving toward a down payment, evidenced by the lowest home ownership rate in almost 50 years. Though many markets are ready and waiting for buyers, demand has yet to be seen. The market for first time buyers is especially tight, due to higher credit standards and a lack of affordably priced options
- Low inventory.
The developing affordable housing shortage is expected to be among the most influential real estate trends in 2016. New construction remains far below demands and the existing stock of homes is drying up, quickly being consumed by newly formed households and second home buyers.
What’s in the cards for you when it comes to real estate trends? Make the most of your hand with the help of Properties Online today.