What can you expect from the 2018 real estate market? Based on my 37 years of experience in the real estate industry, I believe these four things are going to happen:
1. Interest rates will rise. Interest rates already went up in December of 2017, but the government announced that they will raise rates two or three more times. These will not be substantial increases, but we could see fixed rate mortgages go from 4% to 5% or 5.5%.
2. Inventory levels will increase as a result of the rate increase. Although inventory usually increases by 20% to 25% each spring, we will see even higher inventory levels this summer and fall.
3. Home prices will start to level off as inventory increases. Prices have been going up since 2012. In some marketplaces, prices increased above the peak we saw in 2006. As a result, I believe that we will see these prices level off in the next six to 12 months.
4. The average days on market will go up. Some areas have an average days on market of less than 30 or 45 days. By the end of 2018, we will see the average days on market get back to the normal range, which is somewhere between 90 to 120.
If you are thinking of buying or selling in 2018, these are important things that you’ll want to plan for. If you are thinking of selling, now is the time. If you are thinking of buying, you’ll want to buy before interest rates go up.
If you have any other questions about real estate, just give me a call or send me an email. I would be happy to help you!