2018 brings in some changes and new possibilities for homeowners. First-time buyers and sellers are on the lookout for opportunities that this year could bring. The previous years had been a challenge due to a shortage of homes for sale. Fortunately, experts from Realtor.com predicted that the supply will finally increase towards the middle of 2018. Big House Investors have listed down some of the market trends that you need to watch out for whether you are looking to sell or to buy this year.
Supply and Demand
The real estate market supply will slowly grow and is expected to be at par with the demand towards the end of 2018 as forecasted. If you are planning to sell your property, it is best to do it earlier this year as competition is still low giving you a better chance to sell your house fast and at a higher rate. As supply meets demand, prices may also depreciate. On the other hand, first-time buyers may need to wait a little longer for a chance to finally buy that home they are dreaming of.
Millennial Home Buyers
In 2017, the millennials otherwise known as the Generation Y represent approximately 34% of the largest homebuyer group with 66% of them as first time buyers. This year, this trend will still continue and student loan debts can’t hold them back. According to NAR Chief Lawrence Yun, “millennials consider buying homes as good financial investments”. This is understandable as most of the millennial generation is already starting a family of their own. They prefer “surban” areas with a blend of urban lifestyle and affordability of a suburban neighborhood. This generation are quite dependent on technology so if you are in the Real Estate business, make sure that you have access to the different social media platforms and apps to target and reach these buyers.
Experts predicted that mortgage rate will slightly increase from 4% last year to 4.5% by the end of this year. This means that home prices would rise resulting in increased monthly mortgage payments although the increase may not hugely impact buyers.
New Tax Law
The Tax Cuts and Jobs Act took effect on January 1st. A lot of homeowners wondered how this will affect them. Under the new law, if you take out a new mortgage you will only be allowed to deduct the interest on debt up to $750,000 from $1 million. Current loans of up to $1 million are grandfathered and are not subject to the new $750,000 cap. Homeowners also need to know that the property tax deduction is now limited to $10,000.
The real estate market is quite optimistic this year compared to the previous year. There’s a lot of opportunities for both sellers and buyers. If you want to know more about how you can sell your property or if you are looking to buy a property, we’d be happy to assist you. Our goal is to help make every homeowner’s life easier and provide a win-win situation by paying a fast, fair, and honest price for your house.