the 2019
housing forecast
MESSAGE FROM
J. LENNOX SCOTT
John l. Scott REAL ESTATE
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MarketInsights™
HOUSING FORECAST
In 2019, there will be many opportunities for buyers and sellers in the residential housing market. Looking ahead, many positive factors will translate to a surge spring market and a strong market in the fall. Regardless of the market conditions, it’s crucial to work with a skilled broker who will guide you in the process of buying or selling.
"In 2018, we saw a shift in the housing market from frenzy back down to surge/strong sales activity intensity."
2019
When looking at key factors that lead to a healthy housing market, many key factors are positive – so what can we expect in the year 2019?
J. Lennox Scott
Chairman and CEO
More affordable and mid-price ranges
Heading into 2019, we anticipate the more affordable and mid-price ranges in all markets will go up one level of hotness after January 1 to a surge level of sales activity intensity, then transition back down to strong/healthy for the remainder of the year. From January to April, we will see a mild increase in the median home price appreciation, which shows up in closings into June. Then, price appreciation tends to flatten out the remainder of the year due to the large number of new listings that come on the market over the summer, creating dispersed buyer energy. For the luxury market, we will see a continuation of selective buyer activity.
New listings from this point forward are coming on at market price; premium pricing came off and sellers have repositioned to current market price. However, due to the market adjustment, homes priced right for their hyperlocal market may still receive multiple offers.
Though multiple-offer situations will not occur as often in 2019 as they did in the past, they are likely to occur alongside more traditional transactions close to the job centers. Buyers can miss out on opportunities when they don’t understand their hyperlocal market and underestimate competition from the backlog of buyers. When a property is priced right, it’s key to come prepared, working with a skilled broker for the best chance at securing the home of
your choice.
For buyers looking to enter the housing market in 2019, it’s important to lead with any strong motivating factors to move, coupled with market research. This research should include checking recent transactions for the last several months and reviewing the six phases of the yearly housing cycle to fully understand your hyperlocal market. Additionally, being Buyer Ready, Day One™ is crucial to securing the home of your choice; in the internet age, being prepared to act quickly is key.
Buyers in 2019 will have good selection of homes available for sale, and
many buyers may have the opportunity to arrange inspection, finance or
home-to-sell contingencies.
Buyers – Buyer Ready, Day One™
The best time to sell is when the timing is right for you. Seller gridlock has eased in many markets, and there is no issue with buying and selling within same-market timing – the result is often the same net seller equity any time of the year. While this is typically the case, there are certain scenarios that could have a differential. When looking to sell, it’s important to work with an experienced broker to showcase your home in the best light to get the best price.
Sellers – Market Ready, Day One™
Despite some headwinds, there are still many positive signs in the current residential
housing market. Job growth, the number one indicator of a strong housing market,
remains positive.
Millennials, who have been longstanding homeowner holdouts in many cases, have
begun to enter the housing market. According to a recent study , the desire to purchase is present – 52 percent of millennials hope to purchase a home within the next two years. But for some, high student loan debt can be a large
homeownership barrier.
Interest rates will be approximately 4.7 percent in the first half of 2019, and are forecasted to rise to 4.9 percent by year end. Though interest rates are higher than they’ve been in recent years, it’s important to put our current rates in perspective – they are still historically low.
Over 85 Years
of Innovation and Success
PORTLAND/VANCOUVER
It's all about
the backlog of buyers
Interest rates will be approximately 4.7 percent in the first half of 2019, and are forecasted to rise to 4.9 percent by year end
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1PenFed Credit Union National Mortgage Survey (Sept. 2018) | 2NeighborWorks America at Home Survey (Sept. 2018) | 3Lawrence Yun, National Association of REALTORS® Chief Economist | 02.04.19