Extremely high prices and a limited supply of homes are not what a potential home buyerwants but for the real estate investors, they are the worst nightmare. In 2018, the housing market has seen its share of ups and downs, but the predictions for 2019 are very promising as the existing home sales have already increased by 1.9% since October.
Predicting the real estate market is relatively easy and since 2008, it has risen by 11.4%. An undeniable advantage is that the housing market doesn’t collapse overnight – it takes months to materialize crashes rather than just a few hours. Hence, one always have enough time to recognize the patterns. Typically, buyers search for 10 weeks and look at 10 homes before making a purchase.
Millennials – The Most Active Buyers
The millennials are not halting their home purchase despite the fact that mortgage rate increases to 5.8%. They will account to become the largest segment of buyers with 45% of mortgages. As a matter of fact, millennials are going to stay being the largest segment of home buyers for the next decade as the housing needs are adjusted with time.
During the years 2017 and 2018, the U.S. economy saw a growth of 2% but the home appreciation saw a healthy clip of 3.9%. Around 17% of people below 35 years of age were able to save for down payment until 2016 so that they can actually purchase a home in 2017.
Buying decisions are not influenced by the cliché factors anymore, evaluation of the market is extremely important and RE/DEV crowd can be of great help in this regard.
Advancement in Technology
The 2017 report presented by The National Association of Realtors revealed that 56% of the home buyers aged 36 years and younger found the homes through the internet.The industry has rapidly engulfed the technological changes, especially blockchain, and all the realtors are adapting them to maximize the exposure for their listings. This has been proved by the 65% increase in the number of online listings from 2016 to 2017.
During recent times, the suburban market has seen quite a liking by the masses. From 2010 to 2015, there was a 71% residential growth in this area but in the next 10 years, it is estimated that this growth will rise to 80%. The low prices and the light traffic will be a bit attraction for the people who would like to escape the hassles of living in a busy city.
Low Available Inventory
It is quite surprising to see the draught of real estate inventory whether due to economic, regulatory, or demographic conditions. List-to-sale time has dropped by more than 50% since 2010 and not as many homes hit the market as anticipated. So, it comes down to agents to do a better job so that both the buyers and the sellers can be facilitated.
The Bottom Line
In the current real estate scenario, Texas is the only state which appears to be the dream of a real estate investor. The market is performing unbelievably with San Antonio topping the list, followed by Fort Worth and Dallas.
The median monthly rent for a 3-bedroom home in Dallas is 0.80% of the purchase price whereas the national average is 0.71%. Nonetheless, one needs to be very vigilant and take expert advice before indulging in any kind of real estate investment because the trends keep varying with high volatility.