According to realtor.com’s predictions, the spring housing market this upcoming season should be strong and healthy. The online source for all things real estate used recent housing and economic reports make some calls about coming months. Their chief economist Jonathan Smoke thinks this spring will be a good one for real estate.
What will affect this year’s spring housing?
Smoke pointed to several areas of the economy and real estate market that will affect the next few months of real estate.
Jobs: “Job creation – arguably the most important factor in housing demand – is moving apace,” Smoke says. In January, the U.S. created 151,000 jobs; in February, it created 242,000. Unemployment is near 10-year lows. Smoke predicts that the latest employment growth should translate into a 3 percent boost to home sales this year.
Home sales: From January 2015 to January 2016, home sales grew 11 percent. New home sales have increased, and median sales prices have been declining as builders choose to construct more affordable homes.
Home prices: Many more Americans have joined the real estate market over the past year looking to buy. As they snapped up many of the available homes, inventory is now tighter. However, demand has stayed fairly high while supply is still catching up. High demand and low supply means higher prices. “This is driving prices higher and encouraging consumers who hope to buy this year to get started as soon as possible,” Smoke says.
Mortgage rates: Lower mortgage rates mean more affordability. Smoke says that recent rates give buyers more buying power.
However, we also have to be realistic about the spring housing market. Smoke says, “not everything is rainbows and unicorns. The biggest negative trend impacting potential demand relates to the January and February declines in stock values, which have taken a toll on consumer confidence.”
Overall, spring should be bright for those in real estate. If you are considering selling, now is your time to shine this spring. Contact one of our agents at RE/MAX Paradise can help you put your home on the market today!