What Can Home Buyers and Sellers Expect in 2019?
Louisiana Realtors • January 30, 2019
As quickly as 2018 ended, 2019 has arrived. And as with each new year, especially in the world of residential real estate, a lot more than just the calendar is expected to change. These expectations can mean a lot if you are planning to buy or sell a home in the coming months. So, just like you’d check the weather before making outdoor plans on the weekend, let’s look at a few things that are being forecast for the year ahead.
Mortgage Rates Will be on the Rise
While mortgage rates are still below the levels they reached during the recession, they will continue the steady climb we’ve seen over the past two years. However, rates will remain below average in spite of the strong economic environment we’re experiencing. By the end of 2019, 30-year fixed rate mortgages are expected to 5.8%
In Spite of Rising Rates, Home Sales to Millennials Will Increase
Even with mortgage rates on the rise, demand from Millennials will continue to increase. This surge will add to the growth of first-time homebuyers. 45% of home purchases are expected to be from Millennials, compared to 37% from Gen Xers, and 17% from Baby Boomers.
Inventory Will Improve
Compared to 2018 the increased demand from first-time buyers will be met by a slightly higher inventory level in 2019. The number of homes being put on the market and newly constructed homes increasing, combined with a slower pace of sales will improve inventory for home buyers.
Home Price Growth Will Slow
Another benefit for home buyers in 2019 will be a slow down in home price appreciation. This is a result of increasing inventory. Recent years have seen anywhere from a 5-10% increase in home prices. With buyers having more options, coupled with higher interest rates, price growth is expected to drop from 1-3%.
Please join us in congratulating the Louisiana REALTORS® who have been appointed to NAR committees for 2027. A total of 26 Louisiana REALTORS® members and staff have been selected to serve on NAR committees for the upcoming year. Bill Boyd - Insurance Committee; Member: Regional Representative Luke Bullock - Broker Engagement Committee; Member: Government Affairs Director Donna Chandler - Membership Policy and Board Jurisdiction Committee; Member: At-Large Keary Coffin - Multiple Listing Issues and Policies Committee; Member: At-Large Tony Cornner - Housing Opportunities Committee; Member: State Representative Beth Cristina - Commercial Federal Policy Committee; Member: At-Large Deneka Desroches - Commitment to Excellence Committee; Member: At-Large Cindy Dyer - RPAC Participation Council; Member: State Representative David Favret - Meeting and Conference Committee; Member: Immediate Past Chair Jennifer Hebert - Professional Standards Committee; Member: At-Large Carole Horn - RPAC Trustees Federal Disbursement Committee; Member: Regional Representative Misty Ingersoll - Multiple Listing Issues and Policies Committee; Member: State Representative Angela Lavalais - AEC/Association IDEAS Advisory Board (Inclusion, Diversity, Equity, Accessibility, and Support); Member: At-Large Trish Leleux - FPC Advisory Committee; Member: State Representative Marbury Little - Public Policy Coordinating Committee; Member: At-Large ; Consumer Advocacy Outreach Advisory Board; Member: Committee Representative Ginger Maulden - RPAC Major Investor Council; Member: State Representative Andrea McKey - Strategic Planning Committee; Member: At-Large David McKey - Insurance Committee; Member: At-Large Joe Mier - Real Property Valuation Committee; Member: At-Large Norman Morris - Meeting and Conference Committee; AEC Representative Danette O'Neal - Land Use Property Rights and Environment Committee; Member: Affiliate Representative Austin Polk - Business Issues Policy Committee; Member: At-Large Rhonda Reap-Curiel - Data Strategies Committee; Vice Chair Matt Ritchie - Finance Committee; Member: At-Large Erika Sluss - Membership Policy and Board Jurisdiction Committee; Member: State Representative Evelyn Wolford - Professional Standards Committee; Member: State Representative
From the Louisiana Department of Insurance: Insurance Commissioner Tim Temple joined Governor Jeff Landry and Senate Insurance Committee Chairman Kirk Talbot today to announce that Louisiana is investing an additional $20 million in Fortified homes, bringing the total amount invested in state Fortified projects this year to $100 million. Governor Landry announced that $20 million from the U.S. Department of Housing and Urban Development will be transferred to the Louisiana Office of Community Development Restore Resilient Opportunities for Overhead Fortification (Restore ROOF) program to strengthen residential structures and reduce long-term disaster risk. Earlier this year, the Legislature passed a bill that allows $50 million in additional Katrina and Rita bond money from Louisiana Citizens Property Insurance Corporation to be added to the Department of Insurance’s Louisiana Fortify Homes Program (LFHP). Also beginning this year, LFHP is projected to receive approximately $30 million annually from taxes and fees the Louisiana Department of Insurance collects from the insurance industry. “Building stronger homes is a vital part of making homeowners insurance affordable in Louisiana,” said Commissioner Temple. “I appreciate Governor Landry’s leadership and support as we work with legislators like Chairman Talbot to make Louisiana a national leader in the adoption of Fortified roofs.” The Louisiana Department of Insurance (LDI) has finalized its promulgation of Regulation 136—Fortify Homes Premium Discounts. The purpose of Regulation 136 is to implement the statutory provisions set forth in La. R.S. 22:1483, et seq. , which require that all Louisiana property and casualty insurers provide premium discounts or insurance rate reductions for homes constructed or upgraded in accordance with the fortified standards created by the Insurance Institute for Business and Home Safety. View Regulation 136 here .
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