Last year was one of the strongest years for the real estate market. Experts predict that this strong real estate market will continue for a while. Unemployment is steadily declining and consumers are continuing to buy more, giving the real estate market the boost it needs to continue being successful.
Take a look at these four real estate trends to watch.
Rising Inventory
There are fewer distressed properties in the housing market and single-family home median sales are growing. In 2016, buyers will have a huge inventory of quality houses to choose from in their search for their next home. To stay on top of this trend, zero in on exactly what your client is looking for, to avoid wasting time touring homes that may not meet all of their needs or expectations.
Millennials, Millennials, Millennials
Millennials are officially the biggest generation in the workforce, and experts predict that a good number of these millennials will begin investing in real estate. Realtor.com suggests that millennials will purchase one out of three homes on the market in 2016. Smart real estate agents will be focusing specifically on tailoring the buying process for this younger generation. Increasingly, agents will need to have a steady online presence and be willing to work with technology. Millennials are always researching and finding out information online before purchasing anything.
Mortgage Rate Increase
Late last year, the Federal Reserve increased interest rates, which is expected to lead to higher mortgage rates. This will increase the amount of monthly payments and also affects the debt-to-income ratio, making it harder for buyers to afford homes. Current homeowners will likely choose to expand or remodel their homes with home equity loans, rather than buying a new home.
Buying Is More Affordable Than Renting
Rental prices are increasing across the country, and this trend is going to continue in 2016. Vacancy rates are low, because would-be buyers in the past few years chose to rent long-term rather than buy. Property owners and landlords can increase rent prices, often to amounts that are higher than a mortgage. Purchased homes are more affordable than renting in many markets, and many people will choose to purchase a home and invest in a property.
Of course, these are national trends. Every region is different. Give us a call and we’ll help you decide what might be best in your particular area, and assist you in making the next property transition in your life.
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