4 Key Real Estate Trends for 2017
The new year brings a new administration with a whole new set of possibilities and expectations. What are a few of our predictions for real estate trends in 2017?
1) Price appreciation will slow
Look for national home prices to slow to about 3.9 percent growth year over year, down from an estimated 4.9 percent in 2016. This reduced rate of growth doesn’t point to an unhealthy real estate sector, but rather signals a normalizing process as the market recovers and returns to a more balanced, sustainable rate of growth. We expect to see more historically normal appreciation rates as we move forward.
2) Interest rates will steadily rise
The day before President Trump's swearing in, Federal Reserve Chair Janet Yellen
said, “The U.S. central bank should continue to raise interest rates slowly to keep jobs plentiful and inflation low.” This comes as no surprise, since even before Trump’s election, the Mortgage Bankers Association predicted rates would reach 4.8 percent (an increase of nearly two percentage points) by the end of 2017. Recall that conventional loans saw an immediate post-election increase of nearly a quarter of a percentage point.
If you’re hoping to refinance, do it now, and if you’re looking to buy, lock in your mortgage rate early during your closing. The “making lemonade” side to this stabilization of interest rates? Higher rates usually indicate a strong economy, which tends to be associated with a vibrant real estate market.
3) Millennials climb into the driver's seat
Although this interest rate jump affects the youngest generation of first-time homebuyers, experts still expect millennials to comprise 33 percent of buyers in 2017. Along with the equally as large boomer generation, millennials will drive demand in the U.S. real estate market for at least the next 10 years.
As post-graduation millennials enjoy better job security and more easily qualify for mortgages, they’re motivated to buy a home in affordable areas
and start families. Savvy sellers know that targeting this vast pool of potential buyers yields huge payoffs. Tailor your marketing strategies towards these younger buyers. Emphasize the things they value
in a home to make your property desirable for first-time buyers. Especially important are:
- New kitchen and bath fixtures
- Open floor plans
- Home offices
- Low maintenance
- Energy efficiency
- Good location
4) The West remains the best
Speaking of great location, Colorado Springs ranked #12 in realtor.com’s
Top Real Estate Markets for 2017. With a median home price of $335,000, price growth of 4.77 percent, and a sales growth rate of 6.71 percent, our robust real estate market continues to thrive
. Despite a slight slowdown in the national market, realtor.com’s economic team predicts that most of the nation’s hottest markets in the western U.S. “will continue to lead the nation in prices and sales.” Experts attribute this to low unemployment, strong job growth, and the increase in population that follows, increasing demand for homes, which leads to higher prices.
Let the dedicated and knowledgeable team at Turner Associates
help you achieve your 2017 real estate goals. With over two decades of experience in the greater Colorado Springs and Pikes Peak region, we have a rich history of service in the area. We’re a full-service agency, committed to your complete satisfaction from beginning to end.
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