See excerpt of article published by Erik Martin, below.
Housing market forecast calls for strong opinions
With the year quickly coming to an end, it’s natural to look ahead to 2018. If you’re shopping for a home, you’re likely wondering how the housing market will fare next year. No one knows exactly what will happen, but forecasts from experts can be helpful.
We asked a few market pros to predict real estate matters in 2018. Some were hopeful that conditions could improve for buyers — even those yearning for their first home. Others expect a year similar to 2017. That would mean continued high prices and low supply.
Curious what the experts foresee? Read on for their insights and prognoses. It may help guide your choices in the near future.
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2017 in quick review
Clifford Rossi, a business professor at the University of Maryland, says this year’s market is ending on a strong note.
“Home prices were up over six percent year-over-year in September 2017. Median sales prices for existing homes are $247,000. That’s up about 5.5 percent from last year ,” he says. “And interest rates continue to be low. Freddie Mac is currently reporting fixed rates for 30-year loans at 3.92 percent.”
Kurt Westfield, managing partner with WC Equity Group, agrees that 2017 marked a robust period for real estate.
“The housing market has continued to rise since its historic collapse nearly a decade ago. It’s quite healthy today,” says Westfield.
Looking ahead six to 12 months
Many believe 2018 will continue these trends.
“Home prices nationally are set to continue growing between three and six percent. Home sales will be similar or down a little,” predicts Dr. Ralph DeFranco, global chief economist with Arch Mortgage Group.
Westfield remains bullish on the overall market.
Harvard research: the future of home prices in 2017 and 2018
“Certain sectors and locations will perform better than others and retain core stability. There will likely be some softening in the market as interest rates continue to increase, as expected, and valuations continue to mature. But 12 months from now, valuations may cool down to a meager one percent increase,” says Westfield.
Burke Smith, chief strategy officer for Realty ONE Group, also doesn’t see home prices coming down anytime soon.
“The number of new homes for sale has started to increase. But 2018 buyers won’t receive a break from inflated home prices in the early part of the year due to the overall inventory shortage. As in 2017, there will be too many buyers for too few listings,” says Smith.
Yet, “even the smallest increase in demand could encourage home builders to get out and build more homes. That mean things could look better for buyers by spring 2018,” Smith adds.
Mike Pappas, president/CEO of The Keyes Company, isn’t so sure.
“If more inventory does come onto the market, it will be quickly absorbed. This will be due to low interest rates and pent up demand by first-time buyers,” says Pappas.