Although it’s impossible to predict the future current trends ad statistics create a picture of the market’s health. Home Prices are up 4.6 percent and the average home value is $264,800¹. Sales may be down, but prices will continue to rise. This is good news for
sellers, but may keep buyers on the sidelines in high-price markets.
Home sales are down 1.5 percent from a year ago¹. Experts say that many buyers are priced out of the market or they’re waiting until more homes within their price range are available. Although it’s impossible to predict the future, current trends and statistics create a picture of the market’s health.
Homes are selling fast. Homes are on the market for an average only 29 days, with 52 percent of homes on the market for less than a month.1
Inventory is tight¹. People are staying in their homes longer and housing starts are at an all-time low.2 However, housing permits are up 8.4 percent over last year, which means more inventory to come.3
New tax code may have an impact. The interest deduction is capped at $750,000 (down from $1 million) and the property tax deduction is capped at $10,000. This may mean less expendable cash for those with, or needing, a big mortgage.
Competition is high. First-time buyers made up 31 percent of home purchasers.1 For those in the market to buy, get preapproved for a mortgage to stay competitive. If you need a lender, I can refer you to a great one in my network. Let’s set a time to talk about tour local market. I’d love to share my housing market insights with you and do an annual review if you currently own.
Will we see a market correction?5
Recently, you may have seen news headlines predicting the next recession. The economy has been growing since 2009, the longest stretch in US history.5 Since the economy is cyclical, it’s only natural to wonder when the economy will begin to retract.
Causes of a downturn. Recessions are often caused by unforeseen events or circumstances that shock the market. Sixty-two percent of experts say an overheating economy will lead to the Fed tightening its belt.5 Others say a financial meltdown may be caused by an asset bubble, fiscal crisis or international trade disruptions.5
Reason to be optimistic. Housing isn’t like
Take headlines with a grain of salt. Experts predicted recessions in 2011 and 2016, and neither transpired. It is important to remember that growth doesn’t last, so a downturn would be considered natural. Over the next year, economists predict the Gross Domestic Product (GDP) will continue to grow and unemployment rates will fall further. The risk of recession in the next year is only about 15 percent, and the changes to the tax code effective this year are expected to drive business investment spending.
- National Association of REALTORS
- CNN Money
- National Association of Home Builders
- Wall Street Journal
© 2019 Buffini & Company. All Rights Reserved. Used by Permission. RMMK JANUARY S