According to almost every news article, expert, and online news service, the 2018 real estate forecast is off the charts.
Several factors are contributing to this red-hot outlook. A record high stock market (Dow Jones at 2500), hot job market, (unemployment around 4%) high home sales numbers, and many other economic factors are fueling the flame.
According to Trulia, nearly one in three Americans (31%) think 2018 will be a better year for selling a home than 2017. Also, home-ownership will continue to rise as Gen Xers transition back from renting, to owning, and millennials get their first foray into home-ownership.
As such, we’ll see the home-ownership rate continue to increase. As the 2017-year end data suggests the real estate market in 2018 is on an upward trend.
Fanny Mae’s HPSI (Home Purchase Sentiment Index) shows that home buying consumers have a strong confidence in buying a home. On the flip side, the HPSI shows that seller sentiment is up. This could translate to more inventory on the market in the upcoming months. More inventory would increase sales, and make more houses available to more buyers. This would be like adding gasoline, causing the market to get even hotter!
An article in DS News claims the “Housing Market to Remain Bullish in 2018”. The housing market continues an upward grind. Homeowner equity rose to 58.6 percent in late October, and is at its highest level since 2005. This may stimulate homeowners to sell a home to take advantage of the extra cash value in their home.
Existing home sales are not the only numbers on the rise. According to HUD, and the US Census Bureau, new home sales are also on the rise. New home sales have increased at a seasonally adjusted rate of 17.5 percent! This represent the highest level since July of 2007 (Just before the economic downturn of 08’). This is a 26.6 percentage increase over November’s estimate of a year ago.
In just a short two-week period, the Colorado Springs Gazette headlined several news articles pointing to a hot real estate market.
Consider these Headlines:
- New home sales climb 17.5% (December 23, 2017)
- Economy grew at 3.2% in 3Q (December 22, 2017)
- Home sales climb in November to 11-year high (December 21, 2017)
- Homebuilder mood best since ’99 (December 19, 2017)
- Housing starts rise 3.3 percent (December 20, 2017)
- Homebuilding most in 12 years. Colorado Springs, El Paso County sees 8.2% jump in permits over previous year (January 4, 2018)
- Home prices surge 6.2% (December 27, 2017)
Are you considering buying, selling, or investing in 2018?
Here is what all the data points to.
- If you are selling, great! You just won the lottery. It’s a sellers’ market, and prices are off the charts!
- Buyers, you will pay top dollar for a house. The upside? Interest rates are low, and this makes mortgage payments very affordable.
- Investors? Below market deals are hard to find, but not impossible. You must be creative, but, there are still plenty of opportunities.
Nobody has a crystal ball. But, looking at the numbers, 2018 should shape up to be a year for the record books.
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