What You Should Know About Real Estate in 2019
According to the latest national consumer-sentiment survey by Fannie Mae, American consumers are experiencing a strong Spring real estate season that may, in fact, benefit both buyers and sellers. It’s the most positive overall outlook of the housing market in almost a year. So, the question is, can it really be true that we’re in a buyer’s and a seller’s market? Perhaps.
The numbers are certainly more positive about the overall direction of the housing market than they’ve been in nearly a year. In fact, the mortgage investor giant even expects their own personal financial standing to improve this year, as they believe home loan interest rates will remain affordable. And, housing and mortgage economists agree. This year, for instance, mortgage rates have been on the decline while wages continue to rise. These are key trends that propel the home-buying capacity and influence greater market potential for sales, which makes for a strong real estate economy, particularly in the now and throughout this season.
Now, while the outlook is optimistic, it’s also worth noting past trends. For instance, on a national level, home sales have actually been on the decline, which historically indicates that prices could actually fall in the months ahead bringing years of consistent appreciation to an end. Then, there’s the growing trend of houses sitting on the market longer. Once prevalent bidding wars are slowing, and some sellers are taking to cutting their asking prices. So, how are we really to interpret what’s to come?
Well, we have to look at the facts from both the buyer’s and seller’s perspective. Yes, the real estate outlook is positive. But, it will also vary from situation to situation. So, here’s what we know for sure:
- Lower interest rates indicate a strong spring, good for both buyers and sellers. Last fall, average fixed-rate 30-year mortgages hovered around 5 percent. Now, that average has dropped to 4.08 percent. This has been a great stimulus to the real estate economy, as applications from both homeowners and buyers have increased thanks to the lower rates.
- Home prices are on the rise just at a slower rate. While median home listing prices jumped 7 percent last year, experts predict that price increases from here on out will be moderate. We can expect to see about a 4 percent increase this year.
- Seller asking prices are being reduced. According to the real-estate brokerage Redfin, nearly 21 percent of all listings were cut last month with an even smaller percentage of sales encountering bidding wars.
- Market shoppers have more to choose from. Home listings have gone up by 3.2 percent year after year (according to the National Association of Realtors), which is a good sign for buyers because it keeps price pressures down.
All of this adds up to good news for those looking to enter the current market, especially for home buyers. So, anyone who is looking to get into real estate will be entering on strong grounds.