America’s housing market was very interesting in 2019, with median home prices hiking to unprecedented levels. Unsurprisingly, the market has seen home prices climb up to about 60% since they last bottomed in 2012.
The question that many real estate stakeholders and homebuyers are asking right now is whether or not home prices will exceed the current median price of $316,000 going into the coming year. If the current economic climate is anything to go by, there isn’t any doubt that home prices will continue rising gradually and steadily. But then if we are to compare home prices in 2019 with 2018, you realize that the prices rose at a faster rate of 5 % in 2018 than 2019’s 3.3%. That stat alone paints a different picture and points towards the possibility of homes getting even more affordable in 2020.
Real estate experts in the U.S. predict that home prices will rise by not more than 2.8% in the coming year. The housing market is very unpredictable, to be honest. That is why if you want to be on the safe side, you should be keeping tabs with the overall real estate trends that prevail at any given time as well make sure to hire the right real estate agent who will help you make the best choice. One such trend that will affect home prices in 2020 is the expected scarcity of homes on sale. This fact could potentially lead to prices creeping up, but you can bet that they won’t shoot through the roof.
Difficulty Finding Homes
Lack of homes for sale is likely to hit a new record in 2020. House inventories across the world have been reducing significantly since 2015 and this trend is likely to persist. Many millennials are starting to invest in real estate now and bearing in mind their huge numbers, not even the expected 6% increase in single-family home construction will sufficiently address the looming homes shortage. When buyers compete for the scarce homes on the market, it is only natural that the prices will hike. There is a silver lining in all this, though, as mortgage rates in 2020 might remain within affordable rates, predictably below 4%.
With new homes high on demand, one slight advantage that one seller could have over another seller will prove to be crucial. Sellers whose houses have beer isolation will certainly be selling their homes at higher prices than those without. 2020 will also be the year when home sellers reap the utmost benefits of house sidings because many home investors, both seasoned and newbies, will find more potential for home appreciation in 2020 and beyond if it has contemporary siding designs. Prospective home purchases in 2020 will also be dependent on key attributes such as a home’s potential for land appreciation, location, house age, and the social class of people within a neighborhood.
Where Are Home Prices Pointing Upward?
In the next few months, house markets in some major cities in the US will most likely witness a significant shift in momentum. Cities such as New York and Miami have been hit most by the recent trend of buyer population superseding housing supplies. Here are a few of these cities:
Tampa has arguably the most vibrant real estate industry in the southeast. Being home to Florida’s biggest service and defense-related companies, Tampa has seen its population overgrow its housing market by at least 0.25%. That can only mean that prices here will continue to skyrocket going into 2020.
The economy here is controlled by agriculture, aerospace, and energy sectors. That makes Oklahoma’s economy both healthy and stable. And because life expectancy here is high, the population is overgrowing the housing market by approximately 0.22%.
San Antonio, Texas
The housing stock here has been struggling to catch up with the growing economy but it can’t seem to succeed at it. The population gets approximately 0.31% bigger than the new homes market every year since 2015.
Due to the touristy attributes of Miami, the city has witnessed a steady 0.8% increase in property values in recent years. However, home construction rates have not been impressive as they currently trail the home buyers’ population by about 2.4%.
Are you planning on buying a home in 2020? Well, brace yourself for higher property rates. It is important that you take your time to figure out which houses you can afford and in which regions. And if you haven’t saved up enough for a home, be careful not to mess up your finances by rushing into homeownership. The real estate market is expansive- It will always have something for you even if you come back after a decade. There isn’t any rush to own a home.
Bella Robinson is an architect and writer for different design websites. She is young and ambitious, with a degree in architecture. She has eight-plus years of experience in interior and exterior design. Her mission is to inspire others to live their dreams and create their perfect sweet home.