Happy Valentine’s Day, friends. The one thing certain today is that it is the day of love and what better way to celebrate than to spend time with loved ones.
What isn’t certain is the real estate market and what our new President is going to do with the financial real estate lending industry. While his background was built on real estate primarily, knowing that the housing market has been holding strong the past several years, it’s likely that much won’t change in this area. Fingers crossed.
Here are what experts are predicting for this year.
1. Mortgage Rates will rise.
That’s pretty much a given but still the lowest in history even though we’ve recently seen the largest and fastest increase since 2013. This could be the beginning signs of what’s to come, even with this strong economy.
It’s predicted by the Mortgage Bankers Association that rates would reach 4.8 percent by the end of this year. That’s an increase of almost two percentage points.
2. It’s easier to secure a mortgage
It is much easier now than the past eight years, collectively according to The Credit Availability Index. Why? Jumbo loans and low down payment loans have become more readily available and easier to access. Banks may also be more willing and less hesitant to work with people to get financed than in previous years as well.
3. The amount of cash buyers will level off
For the first time since 2007, the number of all-cash buyers fell and they are projected to decrease for the next couple of years as well, according to CoreLogic.
This is fantastic news for buyers who have had to compete with all-cash buyers bidding wars.
4. Homes are getting smaller, and will continue to do so
For the first time since the recession, the average square footage for new homes fell and is expected to continue to do so with the growing popularity of “tiny homes” in exchange for a more flexible lifestyle. Most people are buying smaller homes simply based on need, because little has been available to the entry-level buyer.
5. It’s getting easier for first-time buyers
With the availability of different loan types and builders serving the previously under-served tiny home market, the market is now beginning to welcome back first-time buyers and with many non-traditional investors, there are now more options available for first-timers to compete with these entry-level properties.
What do you think? Will the predictions hold true or are there any you would add?
Bottom line, don't wait to buy or refinance. Things can change at any time and there is no way to predict the future. Ready to take action now, let's chat!
Happy Valentine's Day!