Mixed bag for buyers and sellers forecast for 2019
In the recent report by realtor.com economic research team using a wealth of housing data, here what came up with as forecast for 2019 home buyers and sellers.
There will be more homes for sale, especially in luxury markets. The persistent super-tight home inventory will get some relief, even though the surge may not be enough to keep up with the demand. According to the report, the nationwide inventory actually hit its lowest level in recorded history last winter. This year, however, it finally started to recover with that expected to continue into next year, even if at a mid 7% gain.
While this is welcome news for buyers, sellers will not have it as easy. “More inventory means it’s not going to be as easy as it has been in past years-it means they will have to think about the competition,” says Danielle Hale, realtor.com’s chief economist. She continues, “It’s still going to be a good market for sellers but if they’ve had their expectations set by listening to stories of how quickly their neighbor’s home sold in 2017 or in 2018, they may have to adjust their expectations”.
Much of the nation is looking for home buyers, as sellers have had it easy for the past few years, but it’s mixing bag. “In some ways, life is going to be easier for home buyers; they will have more options” Hale says. “But life is also going to be more difficult for home buyers, because we expect mortgage rates to continue to increase, we expect home prices to continue to increase, so the pinch that they’re feeling from affordability is continue to be a pain point moving into 2019”.
Millennials are the biggest generational group of home buyers, according for 45 % of mortgages. Some are now even buying move-up homes. Slightly older move-up buyers will reap the benefits of both their home equity and the increased choices in the market. “They are going to be more price-conscious than any other generation” says Ali Wolf director of economic research at Meyers Research. He cites this because millennials, who typically carry student debt, will want to be able to spend on experiences, like travel, taking away from funds they can put aside for a down payment or monthly mortgage payment. “They want to maintain a certain lifestyle, but they still see the value in owning a home. “Millennials are likely to make up the largest share of home buyers for the next decade. The year 2020 is projected to be the peak for millennial home buying. (Amerifirst news letter December 3rd 2018).