If you’ve been thinking about buying a house, 2018 may be the year for you. Several factors are coming together to make 2018 possibly the best home buying year yet!
What do those factors sound like? Well they sound like 2-6% increases in price every year, which means if you want to make moves, you better start now. You could be making some serious money by doing nothing.
You need to live somewhere, right? Why not let that “somewhere” be a house that’s making you money, to the tune of $29,700 a year?
Despite the uncertainties of 2017, the economy and real estate market flourished, and that progress is looking to continue, with even more appeal for homebuyers.
One thing is certain, though, if you’re considering buying a home in 2018, it’ll be best to act sooner rather than later. And why is that?
The real estate market is an excellent place to invest, when the timing is right. It also depends on what kind of property you’re looking to invest in, and what your plans are with it.
If you’re looking to buy a home, either as a primary residence or vacation spot, or if you want to buy a rental property as an additional source of income, 2018 will provide you with some excellent options.
Let’s take a look at some of the factors coming together to make 2018 such an attractive real estate year.
Home Prices
- National home prices have been rising for 23 consecutive months.
- Although the rate of increase should slow down a bit in 2018, there will still be continued steady rising in home prices.
- Despite this incredible growth, the typical warning signs of a bubble aren’t present, so you can purchase a home now with some safety that home values should continue going up, as the demand for homes is greater than supply.
Natural Disasters of 2017
- While this may seem like a strange reason that the real estate market would be appealing to a homebuyer, here are the reasons why:
- Yes, there are damages and a massive loss of property. However, that means new construction, as well as many displaced people needing somewhere to live during rebuild and/ or repairs.
- Surprisingly, in the case of California where homes were ravaged by wildfires, many individuals are actually buying new homes while they wait for their former residences to be rebuilt.
- This is due to the increased rent prices, and many homeowners choosing to simply buy another property while they wait, rather than pay the exorbitant rent.
- Although 2017 saw Hurricanes Irma and Harvey rip through Florida and Texas, and wildfires ravage parts of California, any negative effects on the real estate market won’t last. People are already aware of the risks associated with living in these areas and continue to buy property there.
Technology
- Interestingly, technology is also contributing to why 2018 will be a good time to buy a home, thanks to the actual process of buying a house.
- Mobile devices and smartphones have made it easier than ever to receive immediate information, moving the whole house buying process along much faster as realtors and clients are in constant contact.
- Additionally, drones may soon be a key player in the real estate market, as they make the home buying process more efficient and streamlined.
- Drones can be used to give live virtual tours of homes, in which the potential buyer and realtor don’t even need to be present.
- This is especially helpful for buyers who may be looking at properties in areas where they don’t live, even out of state. With drones, they can see every aspect of a home as if they were there without having to step foot outside their door.
Lending
- The housing crisis of 2008 led to much stricter and more conservative standards for lending.
- Some firms report not offering loans to people who had a credit score under 750, making it very difficult to procure the necessary money for a down payment, even for individuals who could pay the monthly mortgage.
- Now that things have settled down and home prices have been increasing steadily without any sign of being a bubble, lending standards should be relaxing very soon.
Specifically for first-time homebuyers:
- Interest rates and home prices are both on the rise and looking to just keep increasing. So, if you’re a first-time homebuyer looking to make the switch from renting to owning, making that change sooner rather than later will be important.
- Mortgage rates will rise, meaning people will most likely be moving less. This is another reason it’s a good idea to buy now rather than later.
A shortage of housing and a booming job market are coming together to create a strong and growing housing market.
Looking towards the future of the housing market, you can expect annual price increases of 2-6%, with most of the housing markets currently at a low risk of downturn.
So, that means if you buy a house at, say, $249,000, after 5 years the price of your house could have risen an extra $24,900-$74,700 without you having to do anything!
And if you’re buying a house for $495,000? Each year you could be adding an extra $29,700 on to the value of your house (over 5 years that’s $148,500).
It doesn’t get any easier than that.
