We are nearing the end of November and after just one more month, we will have another year under our belts. This has many Americans wondering what 2019 will bring as far as real estate.
Some experts say we could see a major shift, creating a borrower’s market across the U.S. Of course only time will tell, but here are 3 real estate predictions for 2019.
1. Housing Market Will Continue to Improve
A recent survey from the National Association of Realtors indicates the housing market will improve over the next few months.
Two current issues for home transactions are low inventory and interest rates. However, with a strong economy, strong job market and a potential shift to favor buyers, many realtors and economists believe this will only stimulate the real estate market.
Sellers will need to lower their prices to stay ahead of the market. In turn, inventory and buyer demand will increase.
2. Interest Rates Will Continue to Rise
For most of 2017, the average rate for a 30-year fixed mortgage was 4% or slightly below. In 2018 however, interest rates have been steadily increasing and we are almost approaching 5%.
Most experts are expecting one more increase in December 2018 and then 2 or 3 more increases in 2019. Although it is impossible to accurately predict the future, rates are expected to rise to between 5.5% and 6% over the next two years if the economy remains strong.
3. 2019 May Shift to a Buyers Market
The shortage of homes has driven up home prices quickly, creating a sellers market. However, there is already a slight shift that may be more favorable to buyers. And if the current conditions continue, this shift may be more significant.
Buyers may be unwilling to pay high prices for homes at an interest rate that continues to increase, forcing sellers to lower their asking prices. Also, as interest rates continue to rise, sellers will receive less for their home. This may motivate sellers to close a deal sooner than later, creating more opportunity for buyers.
“The housing market has tilted sharply in favor of sellers over the past two years, but there are very early preliminary signs that the winds may be starting to shift ever-so-slightly,” said Zillow senior economist Aaron Terrazas.
Read: Is the Housing Market Finally Shifting to Help Buyers? Michigan FHA Lender Explains
About Michigan Mortgage Expert, Julie Krumholz
Julie is a mortgage lender serving Southeast Michigan with over 30 years of experience. She has worked in underwriting, quality control, processing, closing and loan origination. Her extensive background allows her to advise Michigan borrowers with unusual expertise.
If you are looking for a Michigan mortgage expert to help you navigate through the home buying process, contact Julie today by calling: 586-382-5482.
