The 2019 Outlook: Five Big Questions for the Coming Year
After what might be best described as an up and down year in 2018, what is in store for us in 2019 in terms of real estate and mortgage? Here are five questions that will be front and center this year:
1. What will the interest rates do? This is one of the biggest questions for 2019 as interest rates will have a huge impact on the housing market. Not only will it affect first-time buyers, but it will also affect current homeowners who may be reluctant to buy a new home at a higher rate than the rate on their current mortgage. Realtor.com predicts that the rate on a 30-year fixed-rate mortgage will hit 5.5 percent by the end of 2019, but keep in mind that interest rates do have a history of surprising us.
2. Will the economy continue to grow? The U.S. economy has been steadily growing over the past two years, with a low unemployment rate, rising wages and the highest home-equity levels in history. However, some economists warn that we may see a “softening” at some point in 2019. Much like interest rates, how the economy performs will have a direct impact on the real estate market and the mortgage industry.
3. Will home sales rebound? Although 2018 started off strong, home sales in the second half of the year didn’t keep up with prior years’ numbers. According to the National Association of Realtors, sales of existing homes in the third quarter of 2018 were down 2.4 percent as compared to the third quarter of 2017. Having a strong start to the 2019 spring and summer real estate market will go a long way in helping overall sales figures rebound from last year.
4. Will home prices continue to rise? Almost every expert believes that prices will continue to rise in 2019, so the real question is how much will they go up and how will that compare to prior years. Overall, most experts are predicting a modest increase rather than the robust increase that we’ve seen in the last couple of years. Realtor.com predicts a 2.2 percent increase in prices, while others predict a slightly higher increase, such as Zillow.com’s forecast of 3.79 percent.
5. What will the overall market conditions be like? Many areas of the country have been experiencing a slowdown in the market lately due to the rise in interest rates and low housing inventory, among other factors. Will this slowdown continue throughout 2019? Although many experts believe that it will—at least in the short term—they also believe that such conditions would lead to a more “balanced” market, which would be beneficial in the long run.
If you’re looking for information on market conditions in your area, talk to your real estate agent and mortgage professional.
For more than 25 years, Omega Financial has been serving mortgage clients in Massachusetts. Our brokers have approximately 50 years in the mortgage business. You always will receive fast, courteous, and accurate information. Omega Financial, Inc. is a company duly licensed to operate in Massachusetts as a Mortgage Brokerage. We are located in the Town of Norwood, Massachusetts where we have been operating as Omega Financial Incorporated since 1988.
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