What will happen to the housing market in 2018?
How will the 2018 housing market be? This is the question that has a lot of people shaken up, industry professionals and home buyers and sellers alike. Recently we have seen interest rates fluctuate up to 4.5% for an 30 year conventional loan, and on top of that the new tax reform can’t be helping the housing market of Westchester County where the taxes are astronomical and the purchases prices are high, right?
Well… yes and no. Obviously this will affect affordability for buyers that will be affected by higher interest rates and are being priced out on a regular basis as homes are going over asking price. Although we are optimistic, as the interest rates still remain historically low, even at 4.5% or 5%, and the tax reform and uncertainty in the market may cause some empty nesters or people whom were considering moving really take their thoughts seriously and bring some more inventory to the market.
Should I be worried?
It’s early in the game to see the real impact of the Tax Reform on the housing market, although if the amount of inventory increases in the area and home sellers become motivated to make a move, an increase in inventory can create a more balanced market, which will place the buyers in a better position in our market. If the inventory increases dramatically, it is likely that we will see prices begin to flat line and eventually drop as the market begins to fall into a buyers market, which is not such a bad thing considering pricing is inflated and the drop in pricing can counterbalance the rising interest rates and buyers are always concerned over qualifying for a loan great enough to get them their dream home.
In conclusion, we would say don’t panic. We don’t predict a drastic change in the market, although in our opinion it will be new market conditions that professionals, buyers, and sellers will h ave to adapt to in 2018.