The real estate and housing market has been in very big trouble as of late as home prices continue to soar significant numbers in the past couple of years. This increase in home prices, as well as increasing mortgage rates, have prevented home buyers, especially the first-timers from entering the market during these times. What’s even worse is that this trend will continue at least for the next year.
In an article published by Kathleen Howley in Housing Wire, home prices will increase 4.7 percent in the next year, and that is according to the estimate released by real estate expert company CoreLogic. Read the article below to learn more.
Home Prices Will Increase 4.7% in the Next Year, says new CoreLogic Estimate
CoreLogic is more optimistic than other major forecasters such as NAR and MBA
Photo Courtesy of Housing Wire
Home prices will increase by 4.7% from April 2019 to April 2020, according to a new CoreLogic estimate. That will be a faster pace than the 3.6% gain in the prior year, the report said.
CoreLogic’s projection is above forecasts by the Mortgage Bankers Association, Fannie Mae and the National Association of Realtors. MBA forecasts a 4.2% gain for U.S. home prices over the next year, measuring the second quarter of 2019 with the same period in 2020. Fannie Mae, the largest mortgage finance company, puts it at 4%, and NAR projects a 2.9% gain.
Frank Nothaft, chief economist for CoreLogic, said his projection was based on a drop in mortgage rates and an increase in household income.
“Mortgage rates are 0.6 percentage points below what they were one year ago and incomes are up, which has improved affordability for buyers,” said Nothaft. “However, price growth has remained the highest for lower-priced homes, constraining housing choices for first-time buyers.”
The average fixed rate for a 30-year mortgage was 3.99% last week, compared with 4.56% a year earlier, according to Freddie Mac. Last week’s average was the lowest since January 2018. Mortgage applications during the week ending May 17 rose 2.4% from the previous week, according to Mortgage Bankers Association.
Wage growth has picked up steam in recent months, after years of stagnation. Federal Reserve Governor Lael Brainard cited the positive news about wages in a speech last month in Washington. See full post here…
This is definitely not very good news for the entire housing market as home prices have been on the rise since last year. Moreover, the 4.7 percent increase means that it is rising at a faster pace than the prior year. While employment rates of adults in their prime working year have been steadily rising, this is certainly not enough to keep up with home prices.
As mentioned earlier, rising home prices, especially in the low-priced homes, have been the real estate market trends, and this has been proven by the study conducted by CoreLogic last month. The report showed that prices also increased by 3.7 percent year to year.
CoreLogic Reports March Home Prices Increased by 3.7% Year Over Year
CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled solutions provider, today released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for March 2019, which shows home prices rose both year over year and month over month. Home prices increased nationally by 3.7% year over year from March 2018. On a month-over-month basis, prices increased by 1% in March 2019. (February 2019 data was revised. Revisions with public records data are standard, and to ensure accuracy, CoreLogic incorporates the newly released public data to provide updated results each month.)
Image Source: Core Logic
Looking ahead, after some initial moderation in early 2019, the CoreLogic HPI Forecast indicates home prices will begin to pick up and increase by 4.8% on a year-over-year basis from March 2019 to March 2020. On a month-over-month basis, home prices are expected to decrease by 0.3% from March 2019 to April 2019. The CoreLogic HPI Forecast is a projection of home prices calculated using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.
“The U.S. housing market continues to cool, primarily due to some of our priciest markets moving into frigid waters,” said Dr. Ralph McLaughlin, deputy chief economist at CoreLogic. “But the broader market looks more temperate as supply and demand come into balance. With mortgage rates flat and inventory picking up, we expect more buyers to take advantage of easing housing market headwinds.” Click here to read the rest of this post…
Also according to CoreLogic, the available data indicates that home prices, in general, will begin to pick up and increase on a year-over-year basis. A glimpse of good news for the housing market is that it is becoming more temperate as supply and demand come into balance, as well as mortgage rates being flat. Experts are expecting more home buyers to enter the market and take advantage of easing housing market conditions.
Now with more buyers are expected to get exposed in the housing market despite rising home prices, the question now arises for the other side of the fence; the home sellers. Is it a good idea to sell your house in 2019? To get things into perspective, check out this article written by Devon Thorsby in U.S. News answering the question of why you should sell your home in 2019.
Why You Should Sell Your Home in 2019
Few people are predicting that 2019 will be a record-breaking year for home prices.
But relatively speaking, 2019 might be the best time for you to put your house on the market. Especially if you’re on the fence about selling this year or next, Nick Ron, CEO of House Buyers of America, recommends going with the devil you know rather than the devil you don’t.
“I think it’ll be better than 2020 and 2021 – who knows what’s going to happen in those years,” Ron says.
Home price growth slowed in the second half of 2018, with fewer buyers entering the market, at least partially due to rising interest rates issued by the Federal Reserve. In 2019, consumers shouldn’t expect homebuyers to flood the market again and drive prices through the roof, but it’s also unlikely to be a crisis for home sellers.
If you bought your house in the last year or two, still love it and don’t want to part with it, go ahead and wait another five years before revisiting the thought of selling. But if you’re weighing your options to sell, considering selling this year or maybe the year after, don’t play the waiting game.
Here are four reasons to sell your house in 2019:
New buyers are still entering the market.
Interest rates are still on the lower end.
You have high equity.
Selling now will be better than waiting till 2020
New Buyers Are Still Entering the Market
As interest rates rise, some buyers will hesitate to make an offer on a home or apply for a mortgage, so be ready to see occasional drops in buyer activity. And if your house is at the higher end of the price range in your market, you should expect less buyer interest than before. Ron notes the combination of rising mortgage rates and home prices exceeding buyers’ budgets are what has caused the slowing of homebuyer activity in recent months. Learn more here…
With several new buyers entering the market and mortgage interest rates are still on the low end, this is indeed the perfect opportunity for you to put your home into homes for sale listing. It’s only a matter of time you’ll receive offers from potential home buyers. Just make sure not to raise prices way higher than the market estimates, as well as become more flexible during the negotiations.
Lastly, if you need some assistance for your home selling, particularly in finding home buyers in various listings, Dependable Homebuyers is more than willing to assist you in your need; signing up for listing pages, creating a campaign, the needed requirements, etc. To learn more, visit https://www.dependablehomebuyers.com/tennessee/nashville/
