• Realtor.com® Forecasts Post-Election Economy to Result in Higher Mortgage Rates
  While Housing Delivers Slower Gains in 2017
• Phoenix housing market predicted to be No. 1 out of 100 local metro forecasts

The 2017 housing market will be a year of slowing, yet moderate growth, set against the backdrop of a changing composition of home buyers and a post-election interest rate jump that could potentially price some first-timers out of the market, according to the realtor.com® 2017 housing forecast released today.

The report also predicts the top five housing trends of 2017, as well as home prices and sales for the 100 largest metros in the U.S.

2017 National Housing Forecast
The 2017 national real estate market is predicted to slow compared to the last two years, across the majority of economic indicators. Home prices are anticipated to increase 3.9 percent and existing home sales are forecasted to increase 1.9 percent to 5.46 million homes. Interest rates are expected to reach 4.5 percent due to higher expectations for inflationary pressure in the year ahead.

Realtor.com® is forecasting the homeownership rate will stabilize at 63.5 percent after bottoming at 62.9 percent in 2016. New home sales are expected to grow 10 percent, while new home starts are expected to increase 3 percent. The forecast is based on GDP growth of Continue Reading

Overall, 2016 was another strong year for U.S. commercial real estate markets despite some forecasts claiming the bubble would burst, and we have reason for continued optimism in 2017. Still, with the impact of the recent elections on commercial real estate markets, the industry is anticipating possible changes in regulations and tax structures that could lead to some new uncertainty and volatility this year while opening new growth opportunities.

1. Renewed Confidence to Drive CRE Strategy
Property values are approaching 2008 levels, but this time it’s not a false bubble. The market is not overleveraged, and the fundamentals are stronger. A feeling of renewed confidence is driving how investors are approaching their strategic planning for 2017. The anticipated lifting of regulatory barriers and the lowering of tax rates should trigger Continue Reading

Various real estate entities have weighed in with their prognostications for the 2017 housing market. Most observers expect home sales and prices to moderate in the coming year. They say suburbs will make a comeback while the days of low mortgage rates are over.

Of course, a lot depends on the actions of the new administration. Although President-elect Donald Trump said little about housing during the campaign, some of the issues he highlighted will have an effect on the residential real estate market, such as infrastructure spending, regulatory and tax reform, and immigration policies.

[Mortgage rates move higher for the seventh week in a row]

Below is a roundup of what the experts say buyers, sellers and renters can expect in 2017:

Realtor.com predicts “a year of slowing, yet moderate growth.” The listing service for the National Association of Realtors compiled five housing trends for 2017:

Millennials and boomers will dominate the market. Realtor.com expects these two massive demographic groups to power demand for the next decade.

Midwestern cities will continue to be hotbeds for millennials. According to Realtor.com, millennials are clamoring to live in Madison, Wis.; Columbus, Ohio; Omaha; Des Moines; and Minneapolis.

Slowing price appreciation. Realtor.com forecasts home prices will grow at Continue Reading

National Multifamily Index (NMI)

• Several markets with favorable supply-and-demand balances and momentum in hiring made large moves to ascend to the top spots in the 2017 National Multifamily Index (NMI).
• Los Angeles advanced 11 places in the Index from one year ago to take the highest position in 2017 behind a forecast for further tightening in vacancy and minimal supply growth. Robust job growth propelled the seven-rung rise of Seattle-Tacoma (#2) and Boston (#3) also executed an advance of seven places on its strong job market.
• Minneapolis-St. Paul (#4) is the highest-ranked Midwest metro this year. San Francisco (#7) and San Jose (#8) were downgraded from the top of last year’s NMI as their growth cycles mature, and New York City also declined to the last spot in the top 10.

National Economy

• Economic performance in 2017 could benefit from the carryover of last year’s momentum. Continue Reading

Continue Reading

It’s been a great year for real estate. Spurred by the Federal Reserve’s mixed reports and low inflation, mortgage rates continually slid through October to historic lows near 3.5 percent. Compared to 2015, the U.S. Census Bureau reports new home sales are up over 12 percent and the National Association of Realtors reports existing home sales are up almost 6 percent.

Since Election Day pegged Donald Trump as the new president elect – a man notorious for making billions in real estate – mortgage rates shot up over a half percent, creating wariness for homebuyers and sellers alike on the short and long-term effects of the new administration on the real estate market.

While the economy is sure to experience some turbulence through the transition into the new administration, the 2017 real estate market should be spurred by loosening of lending practices, increasing equity for homeowners and growth in new home construction.

Interest Rates

2016 has been another historic year for mortgage rates as they hovered around 3.5 to 3.875 percent for the first 10 months of the year. While interest rates have fluctuated up and down over the past few years, it’s been five years since we saw interest rates over 5 percent. Continue Reading

In so many ways 2016 was an unprecedented, volatile and, for some, excruciating 12 months. And the housing market was not immune to the year’s whims. At the start experts anticipated a pick up in building activity, instead builders are still not producing enough homes. Meanwhile, home prices appreciated beyond expectations and mortgage rates toyed with record lows before crossing 4% for the first time in two years. “If the expectation was that the market would transition smoothly from deep red hot recovery to normal–that certainly didn’t happen,” says Svenja Gudell, chief economist at real estate data firm Zillow.

Nevertheless, Gudell and others argue that on balance 2016 was a pretty good year for housing. National prices finally crossing the previous 2006 peak, mortgage rates remained historically low and there were some signs that Millennials, a generation which some feared would never buy homes, are beginning to enter the market. Through it all the election loomed large. In 2017 we’ll see how profound it’s effects.

Here are eight things housing experts expect to see in 2017:

1. Prices will continue to rise–but more slowly. 

Prices rose every month last year (throu Continue Reading

Multifamily 2017 Outlook: Positioned for Further Growth

The multifamily market has enjoyed several years of rapid growth and seems poised to continue to grow in 2017, although at a more moderate pace.

• Slow-but-steady economic growth continued in 2016, which supported strong demand for multifamily rental units. Despite high levels of construction permits and starts, vacancy rates remained flat, while strong demand pushed up rents and gross-income growth above the historical norm.
• A greater amount of new supply will be delivered to the market in 2017 but most of it will be absorbed, given continued economic growth and strong multifamily fundamentals. Vacancy rates will increase slightly, but still leave room for rent and gross-income growth.
• The top 10 list of fastest-growing metropolitan areas will see some jockeying for position in 2017, with smaller, more affordable markets making a showing.

Continue Reading