It’s a new year and it’s time to start looking ahead at what changes you can expect in the real estate world for 2018. You can expect new trends just as you would with any new year, but understanding these trends allows you to make smarter decisions and to know how to strategize your home buying or selling moves.
While the year is young, you can still look ahead at the forecast for 2018 when it comes to mortgage rates, marketing strategies, who is going to be buying this year, and how to win the bidding war for your dream home. Take a look at this sneak peek of 2018’s home buying trends.
The forecast for mortgage rates
One thing to realize about 2018 is that it’s expected that home prices are going to be on the rise, although the rise should be small and not a high as it’s been. In addition, mortgage rates are going to increase but it’s hard to say how high the rates will climb this year. This year homes are going to be less affordable if you are already struggling to afford to buy a home, but it’s expected that boomerang buyers could help balance things out for those in this situation.
How marketing may change
This year’s market is going to do an even better job at targeting buyers, by getting to know potential buyers to better market to them. Sellers are going to do better this year at providing better content about their homes to buyers, such as including videos shared on social media and targeting to buyers in newsletters and websites. Many websites are going to start including “Market Reports” for their users (including us!).
The big buyers of 2018
Who is expected to be doing the most buying in 2018? This year you can expect buyers that are currently renting, that are looking for low down payments, and those from all generations. It’s common to get too focused on millennial shoppers and baby boomers, but this year is the time to remember to market to Gen X as well seeing that many from this generation lost their home to foreclosure during the recession and will be ready to reenter the housing market.
The buying preferences this year will involve more buyers that need low down payments and are coming from a rental situation. Buyers may be seeking mortgages that offer the lower possible down payment but they’ll need to be reminded that the lending standards are stricter today than they may have been in the past. They will often be coming from apartment complexes, condos, and townhomes this year and will be swayed by messages show them how they can spend that rent money on their own home.
Supply and demand
This year you can expect the supply of homes to finally catch up with the demand that’s been felt for a while. For a few years now, there has been a shortage of homes, but by the second half of the year, the supply will finally meet demand. This is especially true for those that want to trade-up their home and more affordable homes will become available.
When it comes to that bidding war
In addition to a rise in home prices and available homes, you can expect more bidding wars this year. The supply of homes still hasn’t quite caught up to demand, making new homes hard to come by for buyers. Buyers are sacrificing wishes like the number of bedrooms and the length of commute just to get into a home right now, which means that the bidding wars are favorite the seller’s wishes. It’s a seller’s market for sure, but that may even out by the middle of the year.
If you’re planning on buying or selling your home this year, be sure to be prepared for some of the trends expected for 2018. Home sales are expected to rise about 3.5% and home prices are expected to be on the rise at about 5%. Be on the lookout for these trends to determine if you should buy a home soon or wait until later in 2018!