INVENTORY REMAINS KEY FACTOR AND WHAT CAN WE EXPECT WITH HOME PRICES.
Markets are continually being driven by supply and demand; the housing market is no exception. Since the market crash recovery we are experiencing record low inventory, serving as rocket fuel to price souring. Sellers are receiving multiple offers and buyers are finding themselves in the middle of bidding wars. What should we expect to see for the 2018 Housing Market? Will seller’s continue calling the shots or would buyers begin to see a shift of negotiating power.
Zillow chief economist Svenja Gudell predicts that Inventory shortages will drive the housing market. Gudell believes that inventory will be a concern in 2018 and it will continue playing a major role in price increases. Home prices will continue to grow, but at a slower pace. Due to the lack of inventory home prices are expected to increase 4.1 percent in 2018. This climb is still fast paced compared to the normal annual appreciation that is closer to 3 percent, but it is slower than the current 6.9 percent annual pace of home value growth.
Javier Vivas director of economic research for Realtor.com predicts that inventory is expected to increase. Inventory declines are expected to slow down throughout the year and begin to climb by the fall of 2018. His predictions also state home prices will slow down to 3.2 percent increase. This slowdown will be seen more in the higher priced homes. More inventory yet less buyers in this price range will create a competitive price setting between sellers.
National Association of Realtor Chief Economist Lawrence Yun states the biggest impediment to sales in 2017 and into 2018 is the massive shortage of supply in relations to overall demand. Yun is expecting for existing home sales to remain the same and home price growth will stay positive.
With a market predicting favoritism towards sellers, buyers are wondering if buying a first starter home is out of reach. However, you are not out of the game. Good deals can be found with a little of hard work and understanding of your local market. Ready your buying engines by planning ahead and take on your home search with as much knowledge as you can attain. Have a clear view of your budget and start on the right foot. Get pre-approved for your mortgage and know what price ranges align with your budget. This will give you the opportunity to make quick decisions and give you a head start in negotiations ahead of other buyers looking at the same home.If you are looking to sell, buy, or rent in the New Jersey Hudson and Bergen County area. Please feel free to contact us for a consultation. Our team at Star One Realty will be happy to meet you.
By Fermary Sanchez – Star One Realty Team Member