Hello and this is the first post of the new year for the Boyle Venture Blog. Today, we will be discussing some 2017 market predictions. This is based on experience, looking at the New Jersey Market, and from several online sources. Here are the main points that will make the 2017 real estate market:
1) Interest rates will slowly increase.
- As we saw in December, the federal funds increased which is a good sign of strength in the real estate market. We at BVG expect it to grow further by at least another 1/2% or so by the end of 2017 as prices for homes will continue to increase.
2) Trump's election to office will allow a loosening of lender requirements.
- Dodd Frank will not be entirely removed as that would be too costly in the long run, but there will be major changes to come that will allow lenders to loan more to less qualified people. Not to mention, the dollar will continue to increase in value as Trump has already affected the stock market positively, negotiated large American businesses to stay in America, and has had a Chinese billionaire agree to pledge $50 billion to America. Overall, this will allow for further growth in the United States.
3) New Jersey housing prices continue to lag behind the national average.
- Even though home prices are showing signs of increasing, there is still a large number of homeowners who are underwater on their mortgages. New Jersey's distressed mortgage rate was 8.5 percent in the final quarter of 2015, more than double the national average of 3.4 percent. In fact, New Jersey is still #1 in foreclosures across the country. Overall, the New Jersey market has still not reached the peak of the market in 2005.
4) "Surban" is the newest trend among home owners.
- Basically what a "surban" area is the mix between suburban and urban. Nowadays, most people want to live close enough to the cities to do fun activities but far enough in which to start a family and be away from the hustle and bustle of city life. Overall, it provides the best of both worlds.
5) Millenials do not starter homes.
- Overall, millenials are skipping starter homes and going directly to the move up homes. In fact, there is a strong amount of millenials that still live at home and are saving their money for this type of home. Indeed, the NAR noted that in 2016, 17% of buyers under 35 were able to save enough for a down payment for a home within a year, compared with 14% of all age groups.
In conclusion, the real estate market in the immediate future will continue to go up.
If you have any questions involving real estate, feel free to reach out to me via email at email@example.com or phone number 973-969-2299.