The housing game doesn’t sleep, not for a second. Just when you think you know what’s happening in real estate, something comes along that changes the game completely. 2019 was that way and 2020 looks to be the same, carrying with it trends and shifts to keep everyone on their toes.
If your New Year’s Resolutions include buying or selling a home in 2020, here’s what you need to know.
Mortgage Rates Down, Home Prices Up
Mortgage rates currently sit at 3.75% for 30-year mortgages and 3.2% for 15-year mortgages. Currently we don’t expect much variation in 2020, but there is uncertainty. Fannie Mae and many economists predict the low rates will continue and may even dip slightly lower in 2020. If interest rates do stay low, buyers will be motivated to buy sooner rather than later. However, if rates do start to increase, sellers should be prepared to keep their houses on the market a bit longer.
Just because interest rates are expected to remain low, that doesn’t necessarily mean purchasing a home will be an inexpensive endeavor. Home prices grew slightly in 2019 (3.3%) and most experts believe that the trend will continue, but at a slower rate in 2020 (2.8%) than in 2018 (5%) and 2019.
Millennials Dominate the Housing Market
The generation that was chided for living in their parents’ basement will drive the housing market forward in 2020. Millennials made up almost half of all mortgage originations as of September 2019, expanding the buyer pool–especially for entry-level homes.
Because of this, sellers would be best-advised to list their homes online. Why? Almost all millennials—98%–used the internet in their home search and the great majority—80%–found their home on a mobile device in 2019.
And Speaking of Tech…
The proliferation of tech tools to create a positive buying experience will continue into 2020 and beyond. Listing tools with tons of content, media and 3D tours allow realtors to reach larger audiences and close more deals, faster. Also, more and more showings are happening remotely thanks to web-based video apps that can be used by realtors to give tours of properties to prospective buyers who are out-of-town.
Additionally, organizations are deploying tech platforms to simplify the mortgage lending and property insurance processes. With today’s online lending solutions, customers can upload critical documents, automate credit checks and shorten their lending timeline. Insurers have also stepped up to the plate, offering insurance services that are integrated and embedded in digital mortgage application.
These are just a few of the trends we see for 2020, but in this game there could be more. One thing’s for certain: if it’s happening in the housing market, we are talking about it here–so be sure to check back with us frequently in 2020 to stay on top of all the latest news, trends and reports regarding real estate.