If you’re considering buying or selling a home in 2017, it’s advisable to know what to expect as you dive into the market. Here’s a look at what some experts are predicting for the coming year.
Mortgage rates are expected to rise
2016 saw record-low mortgage rates, but they started to climb after the election. Many experts predict that rates will continue to climb by up to half a percent over the course of 2017. If you’re looking to buy, now is the best time to pull the trigger to lock in the lowest rates you’ll see for awhile.
Midwestern cities will attract more millennial buyers
Realtor.com also expects more millennials to buy their first homes in 2017. Midwestern cities will likely benefit the most from this uptick. Homes in the largest midwestern cities will attract these younger buyers due to their affordability. Some of the cities expected to get a boost from millennials include Des Moines, Iowa; Omaha, Nebraska; Minneapolis, Minnesota; Columbus, Ohio; and Madison, Wisconsin.
Inventory will likely drop
2017 will continue to be a seller’s market, with inventory predicted to drop even further than 2016 levels. The construction of single-family homes hasn’t fully recovered since the recession, contributing to dwindling inventory in many of the country’s largest markets. The inventory in Del Mar, Rancho Santa Fe, Solana Beach and La Jolla are all very low.
New home prices will increase
Zillow anticipates that the cost of a new home could rise in 2017 due to higher labor costs. The country could see a shortage of construction labor due to tighter immigration policies under a Trump administration, which could force builders to raise wages for construction workers. These costs would likely be passed on to consumers. California however, is being proactive in protecting their immigrate workers. Stay tuned to see how this plays out.
“Surban” becomes the new mixed-use
Mixed-use developments have become more popular in recent years, but they’ll soon be displaced by the “surban” community. These are developments that blend the best of both urban and suburban lifestyles. The idea is that these communities allow their residents to walk to work and enjoy easy access to amenities like shopping and entertainment. They are designed to be inclusive and affordable and have strong public schools. Keep your eyes open for the new One Paseo project at the corner of Del Mar Heights Road and El Camino Real in Carmel Valley. This will be an excellent example of a mixed use development.
The west will see the biggest gains
While overall the country will see gains, western states are predicted to see the biggest increases in prices and sales. Home prices in western cities will likely increase to 5.8 percent, while homes sales are expected to increase 4.7 percent. This is great news for sellers in the San Diego area- but it means if you are a buyer, now is the time to get off the fence!
Growing families could benefit the most in 2017
For those buyers who want to trade-up into a larger home, 2017 may be your golden opportunity. Rancho Santa Fe has a handful of ‘reasonably’ priced homes now for someone that wants to move up into the Ranch. Prices for smaller homes have outpaced their larger counterparts, and more inventory is available on the higher end of the housing spectrum.
2017 is going to be a very interesting and exciting year in real estate!
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