The latest real estate trends are described as a mixture of positive and negative developments. For example, the prices of real estate property continue to grow which is driven by various factors – the emergence of buyer demographics, economic downturn, etc.
In this article, we will discuss the latest real estate trends 2019. You will also understand why there has been a decline in property price increases and the rise in mortgage rates that are seen as a result of changes in the US real estate market.
You will get to learn the buyer preference and the changes in technology that are experts to make alterations in the real estate industry. After reading, you should be able to plan real estate purchases and investments.
The commercial real estate sector is growing and commercial real estate has been getting a steady capital flow. This has prompted managers and investors to consider their strategies depending on their willingness to accept risks.
The best cities for real estate investment in 2020 are Toronto, Vancouver, and Montreal in Canada, Lisbon, Berlin, Madrid, and Frankfurt in Europe, New York, Orlando, Dallas, and Nashville in the USA.
The economic decline of 2018 has increased real estate investment in the US which is one of the most prominent and attractive real estate markets.
Increased domestic activity is known as the number one reason for the improved investment flow which successfully turned around two years of decline.
Logistics continues to be the most attractive investment destination in the real estate market, staying super popular among investors despite high prices. This trend is predicted to continue thanks to global industrial investment sales.
Slow Rise in Home Prices
Home prices are expected to increase but at a very slow rate. The number of home listings is also seen to increase by 1%.
There are two reasons for this – the ongoing economic uncertainty has forced home sellers to hold on to their real estate, at least until a better economic outlook shows up and the increased mortgage rates which have scared home investors.
But there remains a market segment that hasn’t lost interest in buying homes – those who prefer new properties. There has been an 8% increase in home construction. What does this mean for real estate agents?
The real estate agents may rake in profits but at a much slower rate. Sellers should we wary of the decrease in offers.
Need for Affordable Homes
In 2019, house rents still beat home purchases. Residential real estate prices aren’t helping as they displace wages increases in more than 80% of the markets. The current high home prices are expected to drive demand for rental housing.
Affordable housing shares have fallen despite growth in residential real estate listings. For real estate markets with the overcrowded population, affordable homes have proved to be insufficient.
Use of Amenities to Attract Customers
From the latest real estate industry news we’ve discovered that landlords, property owners, and builders are looking to capitalize on amenities to attract new customers. Parking access or gyms are no longer of importance as they are expected.
Today, property owners are looking into providing amenities like movie theaters, communal gardens, etc. Smart homes are also growing in popularity. Investors’ move to provide unique amenities may signal the need to identify amenities that could increase the value of their properties. They should consider revisiting their strategies as unique amenities alone can’t attract customers.
Mortgage Interest Rates Are On the Rise
Mortgage interest rates are growing after years of stagnation and in 2020, they are predicted to continue to grow at a rate of 4.4% for 15-year mortgages. The US Federal Reserve decided to increase short-term interest rates as a strategy to control inflation and the overall economy.
For home sellers, higher rates suggest early planning to predict lesser offers. Higher interest rates are also a burden that may make buyers postpone their investments. Canceling a purchase, however, is not the answer. For those who are using credit, the usual 15-year mortgage rate should be considered. A mortgage is a big commitment and adding higher rates to it will make many buyers think twice about their purchase. It is best if you partner with a real estate agent who is familiar with these trends and knows the current market. Professional real estate agents can help you set expectations for how much you can make and how long you will have to wait for the best offer.
More Listings for Luxury Properties
The real estate inventory of luxury and high-end homes is predicted to grow. The availability of comfortable and modern homes is seen as a result of the incentives that sellers get from high prices.
Attractive cities such as San Jose, Nashville, and Seattle are expected to register the most increase in property inventory and are expected to spur the nationwide luxury homes inventory growth.
Luxury homes may see a small reduction in prices. As you know – the law of demand and supply rules the real estate industry market, with luxury residential real estate prices being driven by inventory levels. This is good news for investors who may want to invest in luxury homes.
You may be thinking – all these trends are great but I’m not buying or selling a property anytime soon. Well, one thing’s for sure – the real estate market is not going to crash. With such rising mortgage rates, people are wondering if the housing industry could crash (again). It is impossible to know for sure but a number of trends and factors indicate a housing collapse is not in the future and the economy is going strong.
Here are some of the key indicators:
- People are spending more money
- There are new career opportunities and a low unemployment rate
- Fewer buyers are utilizing interest-only home loans
- Millennials want to buy
- Taxes are lower
Whether you are selling or buying a property anytime soon, you can take advantage of the current trends. If you are planning to invest, you can use the data from these real estate industry trends to ensure you get the most value from your property.
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