Published January 23, 2020
3 Factors That Show Where Our Market Is Headed
What can you expect from the 2020 real estate market? Here are three factors that will give you a pretty good idea.
There are three big indicators that tell us where our market is heading:
1. Increasing demand. Housing demand will stay strong in 2020, according to research by the National Association of Realtors. That’s due in large part to millennials, the largest population cohort in the country. This group will turn 30 on average in 2020—the prime age for buying a first home. Experts estimate this will lead to 4.8 million potential new homebuyers.
2. A drop in home price growth. In spite of this explosion in demand, experts say home price growth will flatten out in 2020. Prices will increase at an estimated 0.8%, compared to 3.8% this year. That might seem counterintuitive. How can prices drop if demand is increasing?
Homebuilder confidence is at its highest level in 20 years.
3. A boost in construction. This one is near and dear to our hearts because we represent a few builders in the new construction market. The answer comes down to a change in supply. Experts estimate that the construction of new homes will finally pick up in 2020. This will relieve the current lack of inventory and cause the drop in price growth mentioned above. A survey of homebuilder sentiment supports this prediction. Right now, homebuilder confidence is at its highest level in 20 years.
So what does all this mean for you? Supply is tight right now. With price growth expected to lag behind inflation in 2020, it makes sense for home sellers to seize this moment. It could mean selling quickly and at a top price.
There are a lot of factors, both in the economy and in your personal goals for this year and beyond. We’d love to get together for a strategy session to figure out together what decision makes the best sense for you.
If you have any other questions for us, don’t hesitate to reach out via phone or email. We look forward to hearing from you.
