The housing market is unpredictable.
One day it can be at its peak, the next on a steep decline. Homeowners are always caught up with when the best time to sell is and when the best time to buy is, but because of the ever changing market that decision can be tricky. Let’s take a look at where the housing market has been in 2018 and what experts predict it will be in 5 years.
Homes have been flying off the market since the beginning for 2018. Homes were selling significantly faster than previous years. This has given so much power to home sellers because there is competition for their home. Not only is the pressure to sell your home quickly gone, but you are almost guaranteed to get close to your asking price. For buyers, this makes it tough because there is competition for homes and they sell fast. Buyers need to give their best and final up front.
Home value has been at a steady high since January especially in larger cities, but there could be a sudden decrease coming soon. The home value appreciation is slowing in over half of the housing markets across the country.
Generally, there is less buying power in America which leads to higher rates because lower income Americans struggle to service their mortgages debt obligation. BUT since President Trump has been in office, the real estate market is unclear, especially with the addition of lower tax rates.
While there a plenty of rumors and predictions circling about another housing crash, that is pretty unlikely. Even though home prices have skyrocketed, we have not quite crossed into the housing bubble territory. However, home prices are definitely going to head back down while mortgage defaults increase.
Since the housing market correlates closely with how the economy is doing, there are many outside factors that contribute to the future of the real estate market. If the economy crashes, delinquency and foreclosures will rise and if the economy is booming so will the housing market.
Millennials continue to be a driving force behind the future of the housing market. Securitized income streams and traditional mortgage bonds are lessening as the bulk of millennials choose to rent rather than own. While some millennials are choosing to buy, they usually do so too early when their income is not steady thus setting them up for debt.
So what will the future look like for the housing market? Despite the outside forces and their effects, experts are making education predictions on where we will be in 5 years. Almost all believe that there is no housing crash coming anytime soon, so the future remains bright!
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