The real estate housing market is looking extremely positive at the moment. We are seeing an entirely different industry relative to its experience during the 2008-2009 recession.
In short, home prices and home equity, rents, and house-flipping have all increased.
Mortgage rates below 5% for the longest stretch in over 6 decades have surely helped boost Market expansion. In turn, there are over 20 million new jobs; family incomes have increased, as has consumer confidence. There is significant recovery in home sales, construction, prices, and home equity wealth.
Single-family rents have increased 33% since June 2009, and home prices have increased 50%.
The rising cost of labor - due to low supply of construction workers – may be driving up home prices. Another factor is the cost of materials, which has increased over the last year due to new steel and aluminum tariffs.
Since early 2019, millennials have accounted for 44% of home-purchase mortgage applications, as they are very positive about wanting to plant roots in a home for themselves and families. Their optimism regarding real estate as a sound investment makes a downturn in the market unlikely, at least for the next two years.
House-Flipping took a hit throughout the recession. Since 2018, economists believe that its stable comeback has been due to investors making more sustainable decisions and, professionals replacing the novice flippers of the past.
The good news of rising employment translates to an increase in home buying and decrease in negative equity rates. Housing is in fact tied to wealth creation, and this correlates to the increase in home flips.
A combination of steady continued growth and inflation rates set at below 2% target, appears promising. If we add
According to economists, it is expected that the housing market will enter a normalcy phase within 2 years. Prices are neither rising too fast nor too slow and, there is a steady increase in young households looking to buy homes over the next 20 years.
A healthy long-term view is what the educated forecast seems to be.
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