Are you considering investing in the housing market? Before you do anything, review the information below for a background of the predicted housing market for 2018.
One of the major trends we see in the housing market today is the low supply – high demand ratio. That is, there is a high demand for houses and a low supply for people to buy from. Frankly, there just aren’t enough of the “right” houses that people are wanting in their specific areas. Now, this isn’t the case for upper income or for people on the coasts (there are a good supply of luxury homes). Thanks to this, prices of rent and homes will increase 3-6%. “The median value of all homes–listed or not–in the U.S. is $200,000, according to Zillow. The median home sold for $263,800 in June, according to the National Association of Realtors” (Forbes). One of the biggest reasons for this is because supply is low, and the demand is high. Once people buy a home now, they are reluctant to leave soon due to the hard work they put in to finding their home and would rather stay put for a while. Single family housing starts are expected to grow about 30%. Now, while the predicted housing starts for 2018 are substantial, they are not enough to cover this demand (for one reason, these housing starts are for housing too expensive for most of the demand).
“Baby Boomers” also have a hand in the present and close future housing market. With most coming into their later years, they will most likely be selling off their homes to live with family or nursing homes. Hopefully this will help with the issue of the housing supply, although mortgage rates are expected to rise moderately. The “hottest housing market,” according to GordCollins.com, is in Vallejo, California, where property is extremely cheap compared to surrounding cities. Other cities to look into for cheap investments would be Fresno, California, Waco, Texas, and Modesto, California.