It's 2016 already in a couple of Day but analysts and real estate experts have already foreseen five real estate trends for the coming year. According to Realtor Mag, behind these five trends is growing employment as the driving force, with more and more people having the power to spend and make investments in real estate either for personal or commercial reasons.
In support of this, Realtor share the same points when speaking about how promising 2016 will be for real estate, adding that while 2015 was a great year for housing since 2007 the coming year will be much better.
The five trends are:
1. "Normal" Is In
Thought growth in housing will be slower compared to 2015, the positive thing is that it is going to be a normal healthy growth. Therefore at this point, a slowdown won't be considered a problem
2. More Generational Buying Will be Seen
Young adults will become more involved in buying housing in the coming year, while later generations who already own homes are already or about to enter retirement will play key roles in both buying and selling activities. With more people getting actively involved in real estate, there will be movement in housing inventory which gives positive effects to supply and pricing 3.
3. The Builders Will Focus on Affordability
More builders will focus on making homes that are affordable for new homeowners. Chief Economist Jonathan Smoke at realtor.com's said, "We are already seeing a decline in new-home prices for new contracts signed this fall." He added, "In addition, credit access is improving enough to make the first-time buyer segment more attractive to builders."
4. Higher Mortgage Rates
As previously reported, many Americans fear that owning a home might be difficult in 2016 because mortgage rates will be higher as Central Bank reportedly has been hinting that they will be raising interest rates. If that happens this will greatly impact the housing real estate sector. However it is believed that it will by the high-tier markets that will feel the impact of these increases the most. Then Smoke says, "That level of increase is manageable, as consumers will have multiple tactics to mitigate some of that increase."
5. Rising Rents
Rent has been steady rising as demand for rental properties increase while supply is tight. "Rents are accelerating at a more rapid pace than home prices, which are moderating," according to Smoke. "Because of this, it is more affordable to buy in more than three-quarters of the U.S. However, for the majority of renting households, buying is not a near-term option due to poor household credit scores, limited savings, and lack of documentable stable income of the kind necessary to qualify for a mortgage today."
