“Active” would be a good descriptor of the 2019 real estate market. Mortgage applications surged as rates dropped to historical lows, NYC became home to the most expensive residential property ever sold in the U.S. at $238 million, prices and sales fell considerably–yet still set records, and rents in Brooklyn, Queens, and Manhattan reached an all-time high. What’s in store for 2020? Mortgage, real estate, and housing professionals weighed in to come up with these six predictions–which all point to a strong market in 2020.
1. Mortgage rates won’t rise, may drop. Mortgage rates are currently around 3.75% and experts–including Freddie Mac and the Mortgage Bankers Associations–believe they will remain below 4% in the coming year. Some think that rates may even fall to 3.5%.
2. Prices will continue to rise. With low inventory, high demand, and low interest rates, property data firm CoreLogic claims that home prices will increase by 5.6% over the next eight months.
3. Inventory will remain low. Experts anticipate that supply will remain tight, especially in the resales market.
4. Millennials will buy, Boomers will stay. People are staying in their homes an average of 13 years, up from just eight years a decade ago. That means fewer resales, but in the meantime millennials are interested in buying, representing nearly half of loan originations in September.
5. The ‘Burbs will make a comeback. After more than a decade of people moving from the suburbs into cities, the ‘burbs are expected to make a comeback due to all of the above factors. Plus, new live/work/play neighborhoods are a big draw for millennial buyers, offering the amenities of big cities without the drawbacks.
6. The industry will go digital. The real estate industry is renowned for hanging on to paper-based processes with white-knuckle insistence. That’s changing, partly due to the expectations of millennials, who represent an ever-increasing real estate demographic.
If you’re interested in selling your property, market indicators appear to be in your favor in the year to come! Happy New Year!