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%.
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As previewed last week, NAR is pleased to share the latest consumer guide focused on Making Your Home More Energy Efficient. This guide helps homeowners understand how to reduce energy usage, make cost-effective upgrades, and improve the efficiency and appeal of their home whether they are planning to sell or stay. As a reminder, all guides in this series are available for download—in both English and Spanish—on facts.realtor . Please allow a few days for the Spanish version of the latest resource to be translated and uploaded. For ease of reference, below is a list of the most recent guides: NEW: Making Your Home More Energy Efficient Real Estate Auctions Buyer’s vs. Seller’s Markets Estate Planning Mortgage Interest Tax Deduction Understanding & Protecting Yourself from Title Fraud Thank you for continuing to engage with the “Consumer Guide” series and for sharing the resources with prospective clients so that they have the information they need to find success in their homebuying or selling journey. Please remember that these guides are for informational purposes only and are not meant to enact or change any existing NAR policy. Be on the lookout for next week’s guide on Wednesday, which will cover buying a historic property.
