Last year faced us with many dynamic changes that we need to factor in. Political shocks such as Trump’s triumph are still to fully unravel, but we are not keen on disastrous forecasts. Instead, we will focus on facts and figures that suggest otherwise. Of course, predicting how the market will behave is never an exact science and there is no crystal ball to rely on. For now, let us just say that 2017 is shaping up to be quite an exciting year, an interesting blend of continuity, change, and innovation.
Rise and shine
First off, we expect to see the continuous rise in prices, although more slowly than before. Now, the “healthy” prices dynamics are the result of several trends, including lower gas prices, better wage growth and the arrival of new buyer cohorts, predominantly Millennials, who have decided to get off the face and come into home ownership. This brings us to the point where the overall growth is closely tied to financial legislation, as well as economic stimuli, most notably interest rates, deregulation, infrastructure projects, inflation, etc.
The bigger picture
Less regulation, for example, is welcomed by many, but it is important to note that it could also lead to looser lending practices and eventually induce another market crisis. Furthermore, global economic tendencies cultivate a shifting ecosystem for all players. Take Chine for example. Its recent stumbling could put foreign investments in a downswing and impede the demand in many markets. What is more, the aftermath of political seismic shifts like Brexit prescribe caution and still await a meaningful epilog.
Diverse urban jungles
Naturally, urban areas appreciate more than suburbs and metro outskirts. At the same time, there are bigger discrepancies between metro areas than ever before, which may benefit some groups of buyers, such as retirees. Another reason to explore the suburban frontier is that many neighborhoods are now adding urban amenities, giving rise to a new emerging trend of “urban” living. This is a great way to get the best of both worlds and immerse in entertainment, shopping, and other activities outside the core city area.
The first part of 2017 seems to be the right time to purchase real estate. One of the main reasons is that record-low mortgage rates are still fostering a favorable climate, which is not expected to last long. Even a humble elevation would increase annual payments significantly and may undermine your property hunting endeavors. Moreover, higher interest rates could also inhibit property deals. So, it may be harder to find suitable properties for sale than you might think. Then again, that depends on the type of real estate you aspire to purchase.
A flexible approach
First-time buyers looking for starter homes may struggle to secure a nice deal. The market is a bit tight, the supply is relatively low and the competition fierce. It pays off to remain flexible, though, and open to various opportunities. For instance, those who are prepared to get away from the urban center can capitalize on a tolerable rise in prices. Another thing to consider is buying a home which requires upgrades and overhauls. More and more buyers are starting to realize that this is a sound strategy to profit in the long run.
Finally, there are some exciting trends to keep an eye on in 2017. One of them is the use of unmanned aerial vehicles (drones), which has been green-lit by federal institutions. This will help sellers show their properties from an amazing new perspective. Buyers will also be able to profit and dispatch drones to take a peek at potential targets. It is clear that the technology will play a vital role. Tech-savvy sellers are generally in a good position and increasingly cater to groups like Millennials, who already possess ample funds to look beyond condos and starter homes.
Housing market segmentation is generating a wide array of different experiences for both sellers and buyers. This means that varying outcomes will be present for individuals according to their position in the real estate landscape. There are a lot of uncertainties surrounding the global economy, and cautious optimism might be the best response. In any regard, it is possible to work your way around the hurdles on the road if you are prepared to show flexibility and due diligence. Short of major turbulences, we expect the upward trajectory to produce a rather good year.