2017 has begun and some are wondering what is in store for the housing market this year. I have done a bit of research and found what experts are saying. Experts are making some interesting predictions!
Here are some of the key predictions for 2017:
- Millennials and boomers are expected to move markets
In 2017, the U.S. real estate market will be in the middle of two huge demographic waves that will continue to go for at least the next 10 years.
Millennials and baby boomers, which are the two largest American generations in history, are both approaching life stages that typically motivate people to buy a home: get married, start having children, begin their retirement, and become empty nesters.
It’s predicted that millennials will make up 33% of buyers in 2017, but may be ower due to increasing interest rates.
- Millennials will look to the Midwest
While the financial picture may look cruddy for our youngest home buyers, the Midwest, with its affordable cities look good. It is believed Midwestern cities will continue to beat the national average with the estimated proportion of millennial home buyers in 2017. Leading the pack are Madison, WI; Columbus, OH; Omaha, NE; Des Moines, IA; and Minneapolis.
“It’s easier for millennials to buy in more affordable markets like in the Midwest,” a source says. “We’re also seeing large numbers of millennials buying in Midwestern markets with or near big universities. So part of this is an effect of recent graduates with good jobs being able to settle down in these more affordable markets.”
- Price appreciation will slow down
It is estimated that nationally, home prices are forecasted to slow to 3.9% growth year over year, from an estimated 4.9% in 2016.
“Prices are still likely to go up at an above-average pace as long as supply remains so tight,” a source says. “The inventory problem is not going away.”
Of the top 100 largest metros in the country, 26 markets are expected to see price increases of 1 percentage point or more, with Greensboro, NC; Akron, OH; and Baltimore experiencing the largest gains.
- Fewer homes, fast-moving markets
The inventory of homes available for sale is currently down in the top 100 U.S. metropolitan markets—and the conditions limiting home supply are not expected to change in 2017. The median time it takes a home to sell, is 68 days in the top 100 metros, which is 14%, or 11 days, faster than the national average.
- The West will lead the way
It’s estimatedthat the metropolitan markets in the West will see a price increase of 5.8% and sales increase of 4.7%, much higher than the U.S. overall. These markets also expected to dominate the ranking of the realtor.com 2017 top housing markets (more on that tomorrow), making up five of the top 10 markets on the list: Los Angeles, Sacramento, and Riverside in California; Tucson, AZ; and Portland, OR.
*Info and statistics were gathered from realtor.com