Forecasts for the American RE market in 2020
What can be
a forecast of home buying activity for 2020 in US?
Well,
nobody can ever say for sure what price twist the market will see during the
year, but economists predict it to be positive for home buyers and renters. The
ground for such upbeat assessment are mortgage rates taking a tumble or at
least remain flat during the year. From this point of view, it will cause an
upward tendency on the housing market, while high mortgage rates usually
foreshadow a drastic slowdown in sales, like it happened in the first half of
2019.
The first
scenario, according to Skylar Olsen, economic research director at Zillow
Group, will be good news for those, willing to buy property as the mortgage
payments remain affordable.
Low mortgage
rates also play on the side of home builders, saving high construction activity.
However, as the supply remains low, construction companies have to double their
efforts to keep up with the demand.
Nevertheless,
Realtor.com has predicted that sales can face a significant drop in 2020, even
despite the low supply and at the same time high demand. The reason is a
constant price growth, which outruns inflation and wage increase. People cannot
simply afford to buy real estate in such circumstances.
What’s your
expectations on the matter?