What’s in store for the market in 2018? While it’s impossible to know  for sure, experts analyze current trends to predict what may happen.

 

Home prices and values are expected  to rise modestly 

Home prices have been increasing around the country, with cities such as Dallas, Portland and Seattle experiencing the  largest year-over-year price gains.1 In fact, Washington has  experienced the fastest rise in housing prices in the United States over the past few years.2 While the National Association of Realtors anticipates 2018 home prices will rise by 3.5  percent, Freddie Mac predicts they’ll increase 4.9 percent.3  This percentage may seem modest, but for cities such as Detroit, Las Vegas, Phoenix and San Diego, rising home prices may continue the 2017 trend of creating more pressure in the market.1 The good news is home values in 28 states have risen to above pre-crisis peaks and are at an all-time high.2 


Rental prices are no longer increasing at the rate of home prices in most areas.4 Although the leveling off of rental  prices may take some financial pressure off renters, for  those thinking of buying, it’s a good time to turn their  dream of homeownership into reality.

 

 

Existing home sales have leveled off for now

Experts predict 2018 will spell more of the same for home sales. Many believe this is due to the increase in interest rates in 2017, which may have reduced the purchasing power of many homebuyers. Home purchases are expected to rise a modest 2.8 percent (5.8 million) in 2018.3  


However, patience may pay off for potential buyers. While  the combination of economic recovery, comparatively low mortgage interest rates and job growth may have brought more interested buyers to the market, inventory has been tight over the last few years. In response, homebuilding has been up and new homes are expected to hit the market this year, increasing inventory for potential buyers.5,6 Many experts are predicting 2019 will be a buyers’ market in many areas. 

 

Will 2018 be a banner year for new homes?

Many experts predict that new home sales will drive the  market in 2018.3 A total of 1.33 million housing starts are  expected for 2018, an increase from 1.22 million in 2017.3  While total home sales are expected to increase over two  percent, new home sales are expected to increase eight  percent, reaching 670,000 sales.
 

 

 

 

Sources:  1. Kiplinger 2. Home Buying Institute 3. NAR, Realtor.com 4. CNBC  5. First Tuesday Journal  6. Business Insider  7. Freddie Mac 8. Fannie Mae

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