It is 2016 already and every player in the real estate market are asking the same question. What is in store this year?
Analyst may have varying, possibly conflicting, predictions but it they all seem to agree that in 2016: it is going to be a seller's market, rents will rise, applying for a mortgage will be easier and more millenials will be buying houses.
1. It is going to be a seller's market
According to The Washington Post, house prices are more sensibly valued and gone are the days, such as during the last bubble, that homes are valued less than the mortgage that is owed.
More importantly, people have learned to apply for mortgage that they can handle. While it has been observed that home prices are steadily rising, it should also be noted that supply is tight. This market conditions are expected to be favorable for someone who plans on selling a home.
2. Rents Expected to Continue To Rise
According to The Washington Post, rents will continue to increase in most areas in the country. Vacancy rates will continue to be low but the problem is that the demand for rental unit will exceed supply. Even if builders are increasing construction of apartments in most areas, it will not be enough to satisfy demand.
3. Applying for Mortgage Would Still Be Easier.
As previously reported, the Federal Reserve's interest rate hike has finally happened after almost a decade. However, according to Time Money, Svenja Gudell economist at Zillow believes that the rate increase will have very little, if not none, impact as the market had not reacted much. Moreover it was said that there will likely be four more increases, but Gudell believes the effect of the hike will be fairly low-key. With more relaxed mortgage procedures, more people getting better jobs, and the expected rise in rent, more might consider purchasing a home a better option.
4. More Millenials are Expected to Buy Homes.
According to The Washington Post, with the job market becoming stable, continued low mortgage rates and easier credit. Growth is expected in the economy and with growth comes improving job market conditions. In addition, according to Time Money interview with Gudell, Millenials will be the biggest buyers in the market as more of them are either getting stable jobs or settling down and getting married.
It therefore seems that 2016, overall, might be a good time to buy a home. We will see about that in the next couple of months? If you agree or disagree feel free to share your thoughts below.
