As we move into the new decade Barbara Popp Real Estate Services realizes that knowing and understanding current market conditions has never been more important. Who are the buyers and sellers, knowing prices, how to competitively price a house, understanding financing, what is selling, who is buying, what it takes to sell your home, market trends, and what the buyer is expecting for the price? All factors to successful selling in 2020. Barbara Popp is the first to tell you “Research and on-going Education are the core of Barbara Popp Real Estate Services.”
In the first issue of The Popp Report, Barbara Popp Real Estate Services will focus on an overview of the 2020 Housing Market.
In an article published by The Washington Post on January 6, 2020, Kathy Orton writes, “Most economists anticipate the housing market moving sideways rather than up or down, propped up by strong employment and low mortgage rates but dragged down by low inventory. “Housing appears poised to take a leading role in real GDP growth over the forecast horizon for the first time in years, further bolstering our modest-but solid growth forecasts through 2021, said Doug Duncan, Fannie Mae’s chief economist. “In our view, residential fixed investment is likely to benefit from ongoing strength in the labor markets and consumer spending, in addition to the low-interest-rate environment. Risks to growth have lessened of late, as a ‘Phase One’ U.S. China trade deal appears to be in place and global growth seems likely to reverse course an accelerate in 2020.”
The National Association of Realtors predicts moderate growth in the housing market and continued low mortgage rates. New-home sales are expected to rise to 750,000, an 11 percent increase that puts them at a 13-year high. Existing-home sales will continue to be held down by lack of supply, rising modestly to 5.6 million, a 4 percent increase. The national median sale price of an existing home is expected to grow to $270,400, an increase of 4.3 percent from 2019. “In 2020, more home-building activity and consequent growth in supply should tame down home price gains,” said Lawrence Yun, the NAR’s chief economist. “That’s a healthy development for potential home buyers. Mortgage rates will hover around 3.8 percent and not fall lower than 3.5 percent, even if the economy weakens. If the economy strengthens, rates aren’t likely to go above 4.1 percent.
Zillow the online home sale marketing company expects home value growth to slow in 2020. The median U.S. home value is expected to end the year up 2.8 percent from the end of 2019. That’s lower than last year’s expected growth of 3.6 percent. Home sales will continue to climb, slowly.
“We expect a slower market than we’ve become accustomed to the last few years,” said Skylar Olsen, Zillow’s director of economic research. “But don’t mistake this for a buyer friendly environment. Consumers will continue to absorb available inventory, and the market will remain competitive in much of the country.”
National Association of Home Builders states Builder confidence is higher than it ha been in two decades, according to the trade association that measures industry sentiment. The NAHB/Wells Fargo Housing Market Index, a monthly survey that gauges builder perceptions of single-family home sales and sales expectations for the next six months, clocked in at 76 in December, after starting 2019 at 58. It’s at its highest level since June 1999. At its lowest point during the Grand Recession, the index plummeted to 8.
Low resale inventory and generally healthy economic conditions – including the longest economic expansion in American history – have lifted builder sentiment,” states NAHB chief economist Robert Dietz.
Additional research for this article pertaining to what it will be like for buyers and sellers was found at Realtor.com.
What will 2020 be like for buyers?
Buying a home in 2020 will offer opportunities for some buyers, as the supply of new homes relieves some of the inventory pressures, and prices moderate. While the inventory of new homes in 2019 remained focused on the high-end, as the luxury market cools, builders signaled their intent buyers will continue to struggle with affordability, even with mortgage rates in an approachable range, as entry-level inventory is expected to remain constrained. The broad price moderation will continue to offer opportunities in mid-sized markets in the Midwest and South.
What will 2020 be like for sellers?
Sellers in 2020 will contend with flattening price growth and slowing activity, requiring more patience and a thoughtful approach to pricing. Sellers of homes priced for entry-level buyers can expect the market to remain competitive and prices to stay firm. At the upper end of the price range, however, properties will take longer to sell, and incentives will be needed to close deals. As the market moves toward a more balanced scenario, sellers who adjust to local market conditions can expect to benefit from continuing demand.
Regionally 2020 will not be without challenges but will bring excitement and happiness to the majority of those selling or purchasing a home. We at Barbara Popp Real Estate Services look forward to being a part of your housing journey. Please call or email today.
Barbara Popp Real Estate Services is available to consult on all your Real Estate needs which include housing and land development. The combined years and specialties that the Barbara Popp team brings to the region are unparalleled. Call or email today.