The housing market was strong in 2017, but what lies ahead this year? Well, some aspects of the market are expected to remain the same – home prices are forecast to remain high, but will rise at a slower rate than last year, and interest rates are forecast to go up as well, evidence of which we’ve already seen this month. Also, tax reform is expected to have an impact, but no one is certain of how significant it will be.
What other housing market trends should we expect to see this year? Here are five interesting predictions we found:
According to a recent article by NerdWallet, those with credit issues may have more options due to nontraditional mortgage offerings from specialty lenders. These options range from interest-only mortgages to loans without typical income verification requirements.
With home values still rising, more homeowners will take advantage of their growing equity by taking out home equity lines of credit (HELOCs). According to a recent report by TransUnion, 1.6 million homeowners will take out HELOCs this year, 16% more than in 2017; however, the combined number of HELOCs in 2017 and 2018 are expected to be a 30% increase over the two-year period of 2015-2016.
Smaller cities will gain popularity with homebuyers and real estate investors alike as larger cities become too expensive and competitive, according to the Emerging Trends in Real Estate Report by the Urban Land Institute and PricewaterhouseCoopers. A separate prediction by Inman indicates that affluent millennials will also increasingly head to the suburbs in search of affordable big city alternatives.
The National Association of Builders says that new single-family homes have been gradually getting a little smaller since 2014 and will continue to get smaller due to the demand for more affordable homes.
Realtor.com forecasts that the supply of homes on the market will finally start to catch up with consumer demand by the second half of this year. New home construction is predicted to be the “game-changer.”
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